US PVC Prices Stands Firm, Stability Expected Following Strong Output and Global Pressure
- Journalist: Jaideep Kumar
Since December 2020, PVC prices have made a strong surge in US, on the back of robust demand and supply shortages caused by the winter storm. Polar storm in February severely hit the Gulf Coast, which is a major hub for production of PVC.
Major cause behind the current positioning of PVC has been the limited availability of cargoes due to turnarounds at two major plants, Formosa Plastics USA’s Plant in Baton Rouge, and Westlake Chemical’s Lake Charles, Louisiana Complex.
Currently, prices of USA PVC stand at USD 1750 per MT FOB Texas. Whereas domestic market still reels under the resolutely high prices. Price of PVC domestically placed at USD 1874-1915 per MT at the conclusion of April 2021.After the storm, key producers including Formosa and Westlake among others anticipated the normalcy in production capacity by end of Q2.
However, prices are retreating in other part of the world including Asia-Pacific, Middles East Asia and Europe. Decline in demand from India due to supply chain disruption in wake of second wake of Covid has been a prominent reason for decline in price in Asia.
As per ChemAnalyst, “Tumbling prices in other regions is expected to pressure US pricing which may be forced to compete with Middle East and North African markets where stabilization in prices has been observed. Westlake Chemicals has also lifted its force majeure on PVC and VCM which signifies the improved production and points towards an ease in prices in coming months”.