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PVC prices rose by Rb6,000/tonne and more in July in Russia

July 02/2020

MOSCOW (MRC) -- Negotiations on July shipments of suspension polyvinyl chloride (SPVC) to the domestic market began in the Russian market in the end of last week. Because of scheduled shutdowns and a significant increase in prices in foreign markets, producers announced a price increase in July of Rb6,000/tonne or more, according to the ICIS-MRC Price Report.

Due to quarantine restrictions on coronavirus pandemic, demand for PVC  reduced significantly in April - May, some converters even had to suspend their work. But the situation has changed dramatically since June due to both the seasonal factor and the relaxation of quarantine.

Demand began to recover dynamically, while the supply from domestic manufacturers was limited due to two turnarounds. PVC prices also increased significantly in foreign markets, which was one of the reasons for the serious increase in PVC prices in the Russian market in July.

SayanskKhimPlast (from 8 July for 30 days) and RusVinyl (from 13 July for 14 days), with a total capacity of about 680,000/tonnes plan to stop their capacities in July. The shutdowns were were announced back in the spring; for the most part, converters were not able to build additional stocks.

Due to quarantine limited demand for finished PVC products reduced significantly in April-May, and no one understood what would happen next with demand. Also, the converters did not have sufficient financial funds to build up stocks.

Demand for PVC began to grow dynamically in various regions of the world, the largest increase in demand was seen in Asia. Because of the recovery in demand and rising oil prices, PVC began to rise in price in world markets.
And if in April the prices of North American PVC for deliveries to Russia reached USD600/tonne, CFR St. Petersburg, and lower, and Chinese acetylene PVC was offered at USD685/tonne DAP Moscow, then by June these prices rose to USD780/tonne CFR St. Petersburg, and USD800/tonne DAP Moscow, respectively.

Demand for PVC from Russian consumers grew quite seriously in June, some converters increased purchases by a third. Buyers were faced with limited quotas from a number of domestic manufacturers in the first month of summer.
The situation with the availability of PVC from Russian suppliers worsened in July, some consumers said that they were not able to fully cover all their needs for PVC.

Some converters intend to cover their current PVC needs with supplies from China and Europe. The prices of the import alternative start from the mark of Rb76,000/tonne, including VAT, and delivery, for Chinese acetylene PVC, European PVC was Rb2,000-4,000/tonne more expensive.

Overall, July deals for Russian PVC with K64/67 were negotiated in the range of Rb78 000 - 81 000/tonne CPT Moscow, including VAT, up by Rb6,000-7,000/tonne from June, for quantities of up to 500 tonnes.
Author:Anna Larionova
Tags:PVC, EPVC, SPVC, Rusvinyl, Sayanskkhimplast.
Category:General News
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