1. Price Trend
In November, the Polyvinylchloride (PVC) market is on a roll, and the market condition turns better. According to the data from SunSirs (average ex-factory price of the calcium carbide method SG5), domestic PVC prices are quoted at 6,650 RMB/ton on November 01, and domestic PVC prices are 6,977.5 RMB/ton on November 28th, an increase of 4.92% during the month and an increase of 8.80% from the same period last year.
On November 28, the PVC commodity index is 87.97, an increase of 0.47 points from yesterday. It is 12.03% lower than the highest point of the cycle at 100.00 points (September 5, 2011), and it is 50.97% higher than the lowest point of the cycle at 58.27 points (December 20, 2015). Note: The cycle refers to September 1, 2011 to present)
2. Market Analysis
Products: PVC futures price have continued to rise recently. It tends to be stronger, with all number going red and supporting the PVC spot market. At present, 5 kinds of spot in the PVC market are scarce, and the quoted prices of various manufacturers have risen. Since October, the PVC social inventory level has declined. The amount of maintaining machines far more exceed that amount in the same period last year. Plus, in the early stage, manufactures has sell their products at a low price. Affecting by those factors as mentioned above, the downstream tends to actively pick up goods, accelerating inventory reduction, so that the current market is scarce. At this stage, some manufacturers have arrears and do not accept new orders, that is, "you have money, and I don't have any goods". The reason behind this market condition is that there are many traders who have taken the opportunity to speculate thereby further increasing the price.
However, the downstream factories are exhausted. Their purchasing enthusiasm is not high, and there are many contradictions. The actual trading situation is mediocre. Now the North is entering the heating season, which is also the off-season of the industry. End customers such as real estate, infrastructure construction have started to reduce their demand for PVC. And the number of PVC maintenance companies has gradually decreased in the later period. The supply has increased, and the market price of PVC may fall. According to data from SunSirs, up to November 28, the mainstream price range of domestic PVC is 6,650-7,000 RMB/ton. At present, the mainstream of PVC5 type calcium carbide in Changzhou area is 7,020-7,100 RMB/ton. The range of PVC5 type calcium carbide in Hangzhou area is 7,050-7,100 RMB/ton. And the mainstream price of PVC ordinary calcium carbide in Guangzhou area is around 7,240-7,320 RMB/ton. Prices have risen to varying degrees.
Futures: The main contract of PVC futures rose in shock in 2001. Up to November 28, it closed up 2.09%, and closed at 6,870 at night, up 55. The highest price during the session was 6,905 RMB/ ton, a new high in the past six months, temporarily ranking first in domestic commodity futures, and the market is still likely to explore.
Import and export: In October 2019, China imported 45.377 million tons of PVC. From January to October 2019, China imported 54.69 million tons of PVC. In October 2019, 37,700 tons of PVC was exported. From January to October, a total of 453,200 tons of PVC were exported.
Industry chain: Recently, the price of crude oil has remained in a narrow range and fluctuated, and the overall price of the ethylene outer disk market has first declined, then rose, and then declined. In terms of calcium carbide, the construction of calcium carbide in the northwest region is normal, and the price consolidation is stable. The prices of upstream raw materials have been consolidated at a low level. Compared with last year, the price has fallen significantly, and the cost support is not enough. The decrease in imports of PVC downstream products and the increase in exports have also supported prices.
Industry: According to data from SunSirs, in November 28, 2019’s Sunsirs bulk commodity list, the top three increasing products are PVC (1.05%), LLDPE (0.45%) ), Styrene butadiene rubber (0.18%). There is one category of products that fell month-on-month that is natural rubber (-0.17%). The average daily increase or decrease is 0.09%.
3. Market Forecasting
SunSirs PVC analysts believe that: the current social inventory is still low; the spot shortage situation is difficult to change in the short term. And merchants are very willing to price, it is expected that PVC prices may continue to rise in the short term.
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