MOSCOW (MRC) - A serious decline in oil quotes and demand in key markets has forced North American producers of polyvinyl chloride (PVC) to significantly reduce export prices. Offers for April shipments to the CIS markets were reduced by more than USD200/tonne compared to early March, according to the ICIS-MRC Price Report.
The dynamic spread of coronavirus in the world made many countries to introduce emergency measures, including stopping processing plants. Because of an oversupply, oil, and with it polymers, became seriously cheaper.
Polyvinyl chloride was no exception, and because of this North American producers had to cut prices significantly for April shipments, including to the markets of the CIS countries. Market participants reported that even in early March, prices for PVC shipments from the United States exceeded the level of USD910/tonne CIF, and most sellers had a limited offer due to a stop on the turnaround of part of the facilities.
But already in the second half of March, a drop in demand in key export markets, including India, forced sellers of North American PVC to adjust their prices. By early April, price offer for the shipment of PVC from the United States reached the level of USD675/tonne, CIF, for the markets of the CIS countries, while agreement of lower prices for significant volumes is not excluded.
Most consumers were in no hurry to agree deals on April shipments of PVC from the United States. One of the reasons is quarantine in their own countries and a reduction in processing volumes.
The second reason is a similar price level for European producers, which, according to logistics indicators, are much closer to potential consumers from the CIS countries.
MRC