Home > Industry Information > In April, the net export of PVC exceeded the expectation, causing the market to worry about domestic demand. The basis will remain high under strong reality and weak expectation
In April, the net export of PVC exceeded the expectation, causing the market to worry about domestic demand. The basis will remain high under strong reality and weak expectation

In April, the net export of PVC exceeded the expectation, causing the market to worry about domestic demand. The basis will remain high under strong reality and weak expectation

2021-05-24

Mmexport1602560248534


Abstract: the overseas production equipment of PVC is gradually recovering, the epidemic situation in India and other regions leads to the worry of demand, the high spot price in the international market is falling, the expectation of the decline of the shipping quotation of Formosa Plastics in June is strengthened, the domestic export window is closed, and the domestic net export volume in April is 224700 tons, which exceeds the expectation. With the weakness of the new export orders, the export volume will drop significantly from May to June. Although the social inventory is at a low level in the same period, if we remove the impact of exports, we still need to consider the demand in the future. At present, there are relatively more centralized maintenance in the upper reaches in the middle and late May, the supply in May is reduced, and the overall supply inventory of the industrial chain is low. The spot market will still be strong in the short term, and the high base phenomenon may continue. After price reduction and promotion, the start-up load of downstream enterprises in early May was slightly better than that in April, but the price difference between polyolefin and PVC was large, which inhibited the acceptance of some terminals for the high price of downstream products. At present, the downstream enterprises are about to enter the small off-season state of rainy season and power rationing, while the supply of upstream enterprises will continue to rise steadily with profit boost after centralized maintenance, In the short term, the strong reality and weak expectation lead to the weakness of the futures market. In the macro level, the weak operation leads to the weak operation of the commodity market as a whole. The enthusiasm of downstream enterprises for inquiry and purchase is obviously weaker than that in the early stage. In the short term, the limited resilience is still regarded as short.

Supply side: raw material calcium carbide: last week, the quotation of calcium carbide mainstream market remained stable, the supply side was affected by the power restriction policy in Inner Mongolia, the output of calcium carbide was still at a relatively low level, and the high price of orchid charcoal made the cost of calcium carbide move up. At present, the demand of PVC, the mainstream consumption of calcium carbide, is weakening due to the centralized repair, and calcium carbide is in the weak stage of supply and demand, which may remain stable in the short term. Affected by the increase of centralized maintenance in the middle and late May, the start-up load of PVC upstream enterprises has declined. At present, the overall inventory of enterprises is low, and most of them still have some pre-sale. The inventory of industrial chain is low and the supply in May has declined. The enterprises maintain the price quotation, and the basis quotation has obviously strengthened. Overseas production equipment is gradually recovering, the epidemic situation in India and other regions leads to demand concerns, the external quotation is in a weak operation stage, the recent export window is closed, the domestic net export volume in April reached 224700 tons, the export volume from May to June is still in a state of sharp decline, and the participants' expectations for the decline of shipping quotation of Formosa Plastics in June are enhanced. By the end of May 20, the weekly data showed that the overall start-up load of PVC was 78.07%, with a month on month decrease of 4.7 percentage points.

Last week, the domestic PVC spot market showed obvious resilience in the short term. The inventory of upstream, downstream and intermediate traders was at a low level in the same period. The centralized maintenance in May led to a decline in domestic supply. Most enterprises still had some pre-sale, and they were relatively willing to support the price quotation. Futures in the macro level is weak, commodity and international crude oil futures under the influence of a significant decline, the basis significantly stronger. In April, the net export volume reached 224700 tons. In the second quarter, the domestic export volume was relatively low, and the social inventory remained out of stock. The start-up load of downstream enterprises was at a higher level in the same period. Affected by the widening price gap between polyolefin and PVC, there was a certain degree of substitution (accounting for a relatively small proportion) in the end market, and the end market was also obviously resistant to the quotation of high-quality products, At present, affected by the price drop in the international market, the export window is closed, the PVC export data in April hit a new high, and the net export volume has exceeded the expected performance, which makes the market participants have a new adjustment in their assessment of future demand. After the centralized maintenance of the supply side, it will continue to return to high supply with the help of profits, while the downstream PVC products enterprises will enter the small off-season state under the comprehensive influence of the rainy season and power rationing, and the recent market shows a strong reality and weak expectation state.


The National People's Congress once again paid attention to the rise of commodity prices, and the macro level was weak. Commodity futures generally fell sharply, and the purchasing enthusiasm of downstream enterprises significantly slowed down compared with the previous period in the period of the high fall of futures. As of May 14, the inventory of East China samples decreased by 5.36% compared with May 7, 42.61% lower than that of May 7, and the inventory of South China samples decreased by 15.96% compared with May 7, 60.26% lower than that of May 7. The total inventory of East China and South China Sample warehouses was 207600 tons, 7.9% lower than that on May 7, and 47.68% lower than that on May 7.

Premier Li Keqiang presided over an executive meeting of the State Council on May 19. The meeting pointed out that since the beginning of this year, due to multiple factors such as international transmission, the prices of some bulk commodities have continued to rise, and the prices of some varieties have reached new highs. We should attach great importance to the adverse effects of rising commodity prices, implement the deployment of the Party Central Committee and the State Council, according to the requirements of precise regulation and control, focus on market changes, implement comprehensive policies, ensure the supply of bulk commodities, curb their unreasonable price rise, and strive to prevent transmission to consumer prices.

Overseas production equipment of PVC has gradually recovered, the epidemic situation in India and other regions has led to worries about demand, the high spot price in the international market has fallen, the expected decline of shipping quotation of Formosa Plastics in June has been strengthened, the domestic export window has been closed, and the domestic net export volume in April is 224700 tons, which is higher than expected. With the weakness of new export orders, the export volume from May to June will decline significantly. Although the social inventory is at a low level in the same period, if we remove the impact of exports, we still need to consider the demand in the future. At present, there are relatively more centralized maintenance in the upper reaches in the middle and late May, the supply in May is reduced, and the overall supply inventory of the industrial chain is low. The spot market will still be strong in the short term, and the high base phenomenon may continue. After price reduction and promotion, the start-up load of downstream enterprises in early May was slightly better than that in April, but the price difference between polyolefin and PVC was large, which inhibited the acceptance of some terminals for the high price of downstream products. At present, the downstream enterprises are about to enter the small off-season state of rainy season and power rationing, while the supply of upstream enterprises will continue to rise steadily with profit boost after centralized maintenance, The strong reality and weak expectation lead to the weak strength of futures, the weak operation of macro level leads to the weak operation of the commodity market as a whole, the inquiry and purchase enthusiasm of downstream enterprises is obviously weaker than that in the earlier stage, and the limited resilience in the short term is still regarded as short.

Upstream enterprises and traders: the export window is closed, the macro level is weak, the commodity market is generally falling, the high spot prices restrain the demand, and the starting load of downstream enterprises shows signs of declining. In the short term, the phenomenon of high base gap will still maintain the recommendation that the enterprises should be spot trading

Downstream plants: the start-up load of downstream products enterprises was relatively high in the same period, with limited upward space, weak operation at the macro level, too large price difference between polyolefin and PVC, high spot price of PVC inhibited demand, and the start-up load of downstream enterprises showed signs of decline in the later stage. It is suggested that enterprises should focus on spot trading for the time being and purchase more goods at low prices.


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