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MOSCOW (MRC)
-- In 2011, the Russian market of suspension PVC (PVC-S) exceeded the
psychological point of 1 million tons. However, last year was quite difficult
for the market, according to MRC analysts.
In 2011, the Russian market of PVC-S grew by 15% year on year and reached
1.014 million tonnes. This is a psychological threshold and a historical moment
for the Russian market. Russia’s PVC-S market growth exceeded the whole Central
Europe index. Such a serious increase in the last year demand was provided by
the producers of PVC profiles and soft compounds.
Since 2006, the
Russian market of PVC-S had become a pure net importer. From 2002 till 2008 the
demand for suspension in the local market grew on average by 31% per year. The
growing needs were satisfied by imports of resins from China, the USA and
Europe. In 2008, the global financial recession resulted in a serious reduction
of construction volumes. As a consequence, the Russian market in the recessional
2009 declined by almost a quarter and made 657 thousand tonnes, while in 2008
this figure was about 859 thousand tonnes.
Deferred demand in 2009
and economic recovery after the recession in 2010 led to a serious increase
in demand for PVC in the Russian market. In 2010, the market of
suspension grew by 34% and exceeded the level of the recessional
2008 - 879 thousand tonnes. The Russian converters have begun to invest in
increasing capacity and build quite optimistic plans for
2011.
Conveters’ optimistic forecasts, the dependence on external
supplies, as well as dynamic growth of PVC quotations in the external
markets, particularly in the U.S., made many participants contract foreign resin
more than enough at the beginning of the year. From January till June inclusive,
the imports of suspension PVC to the Russian market grew more than
twice.
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The moderate growth in demand for finished products made of PVC in 2011
vs. 2010 and imports oversupply in August led to a serious surplus in the
Russian market. Local producers competing with the imports declined domestic
prices considerably. Since September imports volume began decreasing
gradually and in December amounted to little more than 24 thousand
tons.
Last year the Russian producers increased their output of PVC-S by
5% to 554 thousand tonnes. The main increase in production was provided by
Caustic (Sterlitamak), due to the facilities upgrade in 2009.
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In 2012, production is not expected to grow significantly as
the Russian capacities are 100% loaded, the growing demand will still be met by
imports.
The imports of PVC-S in 2011 grew by 30% and made 460
thousand tonnes. Over last year, the North American producers had become one of
the key players in the Russian market. The U.S. export prices to a large extent
determine the pricing in the Russian market. In general, last year the supply
from the U.S. increased by 63% to 241.8 thousand tonnes. The volume of imports
of Chinese acetylene PVC actually stayed at the level of 2010.
In June, a new market player appeared in the Russian market -
Karpatneftekhim (Lukoil Group). Over less than seven months, the company
delivered about 32 thousand tonnes to Russia. This year Karpatneftekhim can
seriously put competitive pressure on the producers from the United States and
China.
mrcplast.com |
