9 May, 2018
Asian PVC players have been sharing mixed expectations regarding a Taiwanese major’s June announcement, which is expected to be made by next week.
Supported by the firming trend in China’s local PVC market remaining in place since early April along with a cautious improvement in India’s demand following lower May prices, some players expect the major producer to approach the regional markets with rollovers or slight increases.
A Taiwanese trader noted, “We think the Taiwanese major may apply small increases on its new offers as the rally in China’s local market continues in the midst of good demand as well as firmer costs and futures prices. Plus, the major producer is planning to have turnaround in June or July.”
An Indonesian trader noted, “Although the major applied significant decreases on its May prices, we expect increases for June given firmer domestic prices in China.”
A Malaysian trader said, “Players in Malaysia are on the sidelines nowadays given the elections in the country as well as the major producer’s awaited June announcement. We expect new offers to emerge on a stable to slightly firmer note.”
A trader in the Philippines commented, “We think that the Taiwanese major may roll over its June prices as the ongoing firmness of China’s local PVC market and the upcoming low season in the Indian market will counterbalance each other.”
On the other hand, expectations of seeing slower demand from June onwards amidst monsoon season in India steered some players to hold softer expectations. The depreciation of the Indian rupee against the US dollar and the recent losses in ethylene prices also contributed to these expectations.
A source from the Taiwanese major opined, “Our June offers will be announced next week. We will either try to roll over or ask for slight decreases as other suppliers’ current offers mostly stand below our price levels in India.”
An Indian trader said, “The Taiwanese major will announce its June prices under the influence of the weakening Indian rupee, which has caused higher import costs. Meanwhile, demand is expected to slow down in line with the start of the monsoon season.”