Asian PVC Market Faces Oversupply Challenges Amid Weak Real Estate Demand in 2025
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PVC prices range between ₹74-77.75/kg, with a notable oversupply in the Asian market due to increased production and declining real estate demand. Despite a 2.5% rise in production to 20.5 million tons in 2024, apparent consumption fell, exacerbating inventory build-ups and pressuring prices downward in a sluggish economic environment.
Key Highlights:
- PVC prices for major grades: ₹74-77.75/kg, with China SG5 variants starting at ₹74.25/kg.
- 2024 Asian PVC production rose 2.5% to 20.5 million tons, surpassing demand growth.
- Real estate, accounting for 65% of PVC demand, saw continued underperformance.
- New production capacities led to inventory surpluses, intensifying downward price pressure.
PVC Market Prices: January Snapshot
- The current prices for PVC K67 grades are as follows: Formosa S65D and CGPC H-66 are priced at ₹77.50/kg, while LG LS100H is slightly lower at ₹77.25/kg.
- HYGAIN HS-1000R is available at ₹74.75/kg, and DCM SR10A is priced at ₹77.75/kg.
- Among the China SG5 variants, Easthope is priced at ₹74.25/kg, matching the price of Erdos, while Zhongtai is slightly higher at ₹74.75/kg.
Demand-Supply Mismatch Impacts PVC Market
- In 2024, the Asian PVC market faced significant pressure from both the supply and demand sides, resulting in a volatile downward trend in prices.
- Total PVC production in Asia reached approximately 20.5 million tons, marking a 2.5% year-on-year increase.
- However, apparent consumption slightly decreased, highlighting a mismatch between supply and demand.
- The real estate sector, which constitutes around 65% of PVC demand, continued to underperform, dragging down overall consumption.
- New production capacities across the region further exacerbated the supply glut, contributing to inventory build-ups and intensifying the oversupply situation.
Market News: Real Estate Slump Weakens PVC Consumption
- During April and May, spring maintenance and real estate stimulus policies led to a price surge of approximately 500 RMB/ton, pushing prices above 6,000 RMB/ton at their peak.
- However, from June to August, prices entered a period of steady decline due to weak demand. Another brief rebound occurred in September and October, supported by autumn maintenance schedules and temporary improvements in real estate investments.
- On the trade front, China’s PVC export volume from January to October 2024 increased by 13.87% year-on-year to 2.17 million tons, with India accounting for nearly 50% of exports.
- However, the Indian anti-dumping investigation cast a shadow over future export prospects. Imports, on the other hand, dropped significantly by 42.68%, highlighting reduced reliance on foreign PVC supplies amid robust domestic production.
Expert Opinion: Surplus Production Intensifies Market Pressure
The Asian PVC market is expected to face persistent oversupply pressures, with new production capacities adding approximately 2.5 million tons, predominantly via the ethylene method. Downstream demand, particularly from the real estate sector, is projected to remain subdued due to sluggish investments and economic headwinds. Midstream inventory levels are anticipated to stay high, further limiting price recovery.
Daily Market Report
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