Domestic PVC Availability Improves, Import Appetite Dips

Key Highlights

• India’s imported PVC prices steady with mild corrections 
• China’s July PVC prices rose 6.96%, later softening but staying high 
• Low calcium carbide costs limit PVC margin expansion 
• August outlook: firm to moderately higher prices in China, range-bound in Indi

PVC Price: Market Overview

India – Imported PVC Prices (Ex-Mundra):

China – Domestic Market:

• July saw PVC prices rise by 6.96%.
• Strong futures market and crude oil surge lifted prices in mid-July.
• Last week of July: prices corrected downward but stayed elevated.

PVC Demand & Supply: High Operating Rates Increase Supply Pressure

1. India:

• Imported material available at competitive rates, some downward price corrections noted.
• Demand steady, but no strong uptick seen yet from downstream converters.

2. China:

• Inventory depletion observed mid-month due to stronger downstream procurement.
• High plant operating rates → higher production → supply pressure building again.
• Downstream utilization (especially hard plastics) remains sluggish (<50%).

Raw Material (Calcium Carbide):

• Prices down 3.36% in July in China, offering limited cost support to PVC.
• Low carbide cost caps upside for PVC margins.

Key Market Developments

• Trade Volumes Up: More active domestic transactions in China due to inventory rationalization.
• Stable Operating Rates: Chinese PVC plants running at high capacity → elevated supply outlook.
• Export Demand: Remains stable and strong, particularly in China, supporting floor pricing

Market Expectations: Export Demand Supports Price Floor

• For the Indian market, prices may stay range-bound with a slightly weak bias due to muted demand recovery and high inventories.
• For the China market, August supply may rise with high plant operating rates, demand-side improvement limited, downstream still not running at full strength, prices expected to hold firm or rise moderately, supported by exports and sentiment in futures/crude.

Outlook:  Range-Bound India, Firm China on Export Momentum

• While PVC prices may not surge sharply, they are expected to maintain a strong tone in August, driven by export demand and cautious optimism in the futures market. 
• However, high inventories and slow domestic downstream recovery could act as headwinds.