US PVC Export Prices Skyrocketing Over Unprecedented Demand and Consistent Rise in Feedstock Values

US PVC Export Prices Skyrocketing Over Unprecedented Demand and Consistent Rise in Feedstock Values

  • 13-Apr-2021 11:00 AM
  • Journalist: Robert Hume

Prices of export Poly Vinyl Chloride from US have witnessed a sharp increase on the back of strong demand from Asia, supply side bottlenecks created by freeze fallout and consistent surge in raw material prices.

Expansion of several production capacities was expected however ramp up has been below par due to ongoing turnarounds of Oxychem’s 1 million mt/year PVC plant at Pasadena, Texas and one of three Shintech’s 1.45 million mt/year PVC plants at Freeport, Texas.

Spot Export Prices touched historic $1800/mt FAS USGC mark in 1st week of April. Surge in prices of PVC have also induced ripple effect on intermediate Ethylene Dichloride (EDC) which jumped to record high at USD 600 per MT.

All major producers of PVC including Shintech , Formosa and Westlake have announced an increment of USD 154 per MT for the month of April which will further exacerbate the already soaring pricing of export PVC.

Demand from Asia-Pacific for Poly Vinyl Chloride has been following this uptrend where it is expected to reach 18835 KT in 2025, according to ChemAnalyst database. Such demand fundamentals not only bode well for domestic producers, but they also lure the foreign manufacturers to export their shipments.

As per a ChemAnalyst source, US export Poly Vinyl Chloride paste resin supply has been around 12-15 KT whereas in China supply went to 80-90 kilotones. These figures point towards robust demand for US Poly Vinyl Chloride which has been the key factor that led to induce a surge in export prices.

In JP Morgan 2021 Industrials Conference, major petrochemical manufacturers Dow, INEOS among others gathered attention towards the limited availability and increasing costs of raw materials which are behind the recent price rise.

Producers are currently focused upon completing the previous orders that got stuck due to freeze-induced shutdowns. A herculean effort is expected in order to clear those accumulated orders and even after that, various market experts believe that no sooner than mid of Q2 2021 that there will be return of normal levels for Poly Vinyl Chloride  exports.

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