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Russian PVC prices increased again and broke another record in June

June 04/2021

MOSCOW (MRC) - Limited supply from producers and still high price levels for suspension polyvinyl chloride (SPVC) in several regions of the world continue to push prices up in Russia as well. Russian producers achieved an increase in prices of Rb2,000-25,000/tonne for June shipment, according to the ICIS-MRC Price Report.

PVC prices began slowly decrease in some regions of the world in May - early June, but are still at a fairly high level.
As a result, there was still no import alternative for Russian converters, with the exception of China. At the same time, the possibilities for the supply of domestic PVC producers to the domestic market were limited, including due to the upcoming scheduled maintenances in July of two plants. Because of this PVC prices in Russia continued to grow; domestic producers announced a price increase of Rb2,000 - 25,000/tonnes for June shipments.

High price levels in several regions of the world have led to an increase in export sales of PVC from some Russian producers in the past few months. Although on a cumulative basis since the beginning of the year, the total export sales of Russian producers were lower than in 2020. Nevertheless, in fact, it was only in June that PVC prices approached export sales in some areas in the domestic market.

In 2021, Russian producers and converters entered with a minimum PVC warehouse stock. Some producers have been shipping PVC to consumers with delays in the past three months, and converters, in turn, cannot replenish their inventories in full. In addition, it is worth noting that in July it is planned to shutdown the facilities of SayanskKhimPlast and the Bashkir Soda Company, the total nominal capacity of which is 590,000 tonnes/year.
Some converters have already reported that producers informed them about the impossibility of supplying PVC to them in July.

PVC imports have increased this year, with a surge in supplies in March and May, but external supplies were still not sufficient to meet demand, which, despite record high PVC prices, is strong. From the point of view of an alternative to Russian PVC, Chinese PVC remains the only option, although PVC in the United States has been dynamically becoming cheaper in the past few weeks. Export prices from Chinese producers for acetylene PVC were currently more attractive than prices from Russian producers.But complex logistics and a long time lag between the conclusion of the contract and the receipt of PVC do not allow us to speak of the possibility of a serious replacement of domestic raw materials with supplies from China.

Discussions on prices for June shipment of Russian PVC began in the second half of last week, but most of the deals were agreed upon in the first days of negotiations. At the same time, the primary issue was the availability of PVC volumes. The price did not matter for many converters for several months. In general,  deals for the supply of Russian PVC with K64 / 67 were done in a very wide range: Rb145,000-171,000/tonne CPT Moscow, including VAT for volumes up to 500 tonnes, against Rb135,000-150,000/tonne CPT Moscow, including VAT in May.

Author:Anna Larionova
Tags:PVC, EPVC, SPVC, Bashkir Soda Company, Sayanskkhimplast, Russia.
Category:General News
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