MOSCOW (MRC) -- Negotiations over June shipments of suspension polyvinyl chloride (SPVC) began in Russia this Tuesday, on 29 May. All producers announced a further price increase, according to ICIS-MRC Price Report.
Demand for finished products from PVC increased in May, but at the same time, many converters were forced to raise their prices for finished products due to the continuing rise in prices of polymer since the beginning of the year. Demand for suspension is expected to increase further from the Russian market in June, and, as a result, producers announced their intention to achieve an increase of Rb2,000/tonne from May in SPVC prices.
Supply of resin is sufficient in the market, although demand for polymer continues to increase and import quantities are scarce. A short shutdown for maintenance at RusVinyl, Russia's largest PVC producer, in April did not affect the market balance. A long shutdown for a turnaround at SayanskKhimPlast, Russian second largest PVC producer, which is scheduled for the second half of July, is ahead.
Russian consumers virtually do not have a reasonable alternative to Russian resin. The rouble devaluation and high prices in foreign markets makes any PVC imports economically unprofitable.
The key suppliers of resin in the past years - producers from the north of China - reduced their June export prices of acetylene PVC by USD10/tonne from May. But this in fact does not change anything - Chinese resin is still much more expensive than Russian counterparts.
Most Russian consumers understand that it will not be possible to avoid increases in SPVC prices for June deliveries. But at the same time, some converters are trying to limit the amount of the price increase of polymer to a smaller value than the one announced initially.
In general, June deals for resin with K64/67 were negotiated in the range of Rb70,000-72,000/tonne CPT Moscow, including VAT. Deals for PVC with K70 were also discussed from Rb70,000/tonne CPT Moscow, including VAT, and prices of some producers reached Rb73,000/tonne CPT Moscow, including VAT.
MRC