For the Quarter Ending June 2023


North America

The PVC prices followed a downward trajectory in the quarter ending June 2023, backed by the persistently sluggish demand in the region's construction sector. The decrease in sales and profit for the producers reflected the challenging global economic environment, along with macroeconomic factors weighed on the commodity performance this quarter. In the H1 of Q2, supply chain disruptions and inflationary pressures affected the downstream packaging industry. Furthermore, despite production issues faced by major producers, including Formosa Plastics Corp. USA and Westlake Corp., PVC demand remained muted. The weak demand was primarily attributed to a slowdown in residential construction in the region due to elevated interest rates by the Fed to limit inflation in the United States at the start of Q2. These restrictive financial conditions and inflation has paused the consumer purchasing power in various sector and conclusively influenced PVC price discussion in the US market. At the end of the quarter, the US Department of Homeland Security (DHS) banned the inflow of Chinese imports to keep forced labor practices out of the US supply chain, and this ban impacted the PVC prices, and market players stabilized the prices toward the end of June.

APAC

According to the latest data, PVC prices exhibited a downward trend in the quarter ending June 2023 in the APAC market. The market participants were concerned about the gloomy demand in the construction and packaging sector of the country. The inadequate revival of the economic condition in China deprived the consumer buying enthusiasm in the domestic market, and sluggish offshore trading activities further affected the pricing movement of PVC in this quarter. Moreover, the volatility in the upstream crude oil prices and lower feedstock Calcium Carbide supported the price decline for PVC in Q2. However, manufacturers opted to reduce production run rates in the face of bearish market transactions in the H2 of the Quarter. In the H1 of Q2, the downstream processing industry deteriorated following the Holiday season. Moreover, the export demand slumped, and rising interest rates weighed on the construction sector offtakes across the regional market. Traders continued to experience oversupplied market since the Labour day Holidays in May 2023 and the drop in crude oil costs and feedstock Calcium Carbide prices.

Poly Vinyl Chloride (PVC) Prices: https://www.chemanalyst.com/Pricing-data/poly-vinyl-chloride-5


Europe

In Europe, PVC prices were low in the quarter ending June 2023, backed by the lower offtakes in the downstream sectors, including the construction and packaging segments. The major factor influencing PVC pricing dynamics was a steep decline in construction offers and ample availability of inventories as interest rates continued to increase and weighed on consumer spending throughout the quarter. The market players closely monitored market conditions and adopted strategies to navigate this period of decline amidst financial stress by reducing production rates, focusing on balancing costs and maintaining a stable supply chain. Meanwhile, the reduction in the feedstock EDC prices and upstream Ethylene costs also supported the decline of the prices during this time frame. The slowdown in the global economic condition resulted from persistent repercussions such as restrained investment, increasing debt vulnerabilities, and shortages in funding in the regional market and conclusively diminished the construction sector demand for PVC. Therefore, the PVC prices were assessed monthly declination nearly 6% in June 2023.

Poly Vinyl Chloride Prices: https://www.chemanalyst.com/Pricing-data/poly-vinyl-chloride-5

Middle East Asia

The PVC price trend in Saudi Arabia was down in the quarter ending June 2023 due to reduced demand in the construction sector amidst the festive season in Saudi Arabia in April 2023, whereas in May, construction activities improved slightly, as per the statement of the Chief Economist of the Riyadh Bank, however this rise in insufficient to drive up the PVC prices amidst high supplies. Moreover, the buying confidence was hindered in Saudi Arabia at the termination of June 2023 by the sluggish offshore demand for PVC and the muted trading atmosphere after one week of the EID holidays in the Saudi market. Additionally, the economic slowdown in the region led to a decrease in the manufacturers' and traders' purchasing enthusiasm and profit margins. These factors collectively contributed to the decline in PVC prices in the second Quarter of 2023 in the region. Meanwhile, the availability of cheaper Ethylene and increment in the production rates, coupled with a rise in employment rates, prompted market participants to lower their prices in response to reduced input costs in Saudi Arabia throughout this quarter.

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