MOSCOW (MRC) -- Negotiations over April shipments of suspension polyvinyl chloride (SPVC) began in the Russian market on Tuesday. Local producers announced a roll-over of March prices for April shipments to the domestic market, according to ICIS-MRC Price report.
Prices of Russian polyvinyl chloride (PVC) has already risen three times since the beginning of the year, and in mid-March, buyers still had concerns about further price increases in April. Producers' stocks are small due to large exports at the beginning of the year, the import alternative is limited. Nevertheless, despite these factors, Russian producers announced that March prices rolled over for next month's deliveries.
Demand for PVC still remained weak from the domestic market because of seasonal factors, but producers do not have large stocks of resin. On the contrary, some of them sold out all their quotas even in the first weeks of the month.
Prices of Russian resin has significantly grown since the beginning of the year, but even in such conditions, customers have limited import alternative. Thus, there is the possibility of alternative and profitable PVC shipments from Europe and China, but supply is tight and it does not allow to completely replace Russian resin.
Quantities of foreign purchases of PVC in China rose by several times in March under the pressure of another increase in Russian PVC prices, but they are still not sufficient to put pressure on national producers, moreover, some quantities of March contracts will enter the market only in April due to the complexity of logistics.
The Russian rouble strengthened against the dollar in the second half of March, and prices began to go down in Asia. And these two factors significantly limited the possibility of raising April prices for the domestic market from Russian producers.
Demand for finished products from PVC has remained weak so far because of seasonal factors, most converters had problems with working capital. However, despite all these negative factors, demand for resin is still expected to increase from the domestic market in April.
April deals for resin with K=64/67 were negotiated in the range of Rb74,000-76,500/tonne CPT Moscow, including VAT, which corresponded to March level, for quantities of up to 500 tonnes. The price spread for special grades, particularly, with K=58/70, was more substantial and in some cases reached Rb79,000/tonne CPT Moscow, including VAT.
MRC