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MOSCOW (MRC) -- A shortage and record
high prices of suspension polyvinyl chloride (SPVC) in the global markets for
over than 10 years have led to a similar situation in Russia. Domestic producers
announced another and record-breaking price hike for January shipments, which
was not seen during the whole history of the price increases, according to ICIS-MRC Price
report.
This year has become unusual for the global PVC market. The
shortage of PVC has remained in many regions of the world since summer, and
prices have been hitting further records over the past more than 10 years. In
the first quarter of 2021, the situation in the global PVC market is unlikely to
change dramatically. The Russian PVC market is not isolated from the global one,
all global events immediately have consequences for Russian consumers. Russian
producers intend to achieve a price rise of Rb15,000-20,000/tonne for January
shipments of suspension.
Demand for resin from Russian processors
has been subsiding for the past two months, but at the same time, domestic
producers had insignificant stocks. And, as a result, many consumers did not
have the opportunity to build up additional inventories of material even amid
constant price increases.
Traditionally, in January, demand for SPVC from
Russian converters is the lowest for the whole year due to the long New Year
holidays and the plants" scheduled shutdowns for maintenance. But most consumers
are in no position to refuse from January purchases partially due to the fact
that it was not possible to build up additional inventories in the previous
months.
Prices rose again for January shipments in many regions of the
world, breaking another record. And for some buyers, SPVC prices exceeded
USD1,500/tonne CFR. As a result, the import alternative was virtually completely
absent for Russian consumers in comparison with domestic material. Even given
the planned price increase for January shipments, Russian PVC was still cheaper
than its imported analogues.
The absence of alternatives and the need to
replenish their inventories did not give consumers a choice. It will not be
possible to avoid another wave of price increases, and converters were trying to
limit the rise in PVC prices in their negotiations.
Negotiations over
January shipments of Russian PVC began on Wednesday, prices of Russian PVC with
K64/67 were discussed in the range of Rb111,000-115,000/tonne CPT Moscow,
including VAT, for quantities of less than 500 tonnes. |
