[Introduction] In May, the export volume of PVC slightly increased month on month, but the year-on-year decrease was still significant. On the one hand, due to the return of domestic market prices to the previous low, the enthusiasm for overseas procurement has gradually improved, and on the other hand, the export volume of the United States has decreased. From the situation of export orders received in June and the enthusiasm for overseas procurement, it is expected that the PVC export volume from June to July may not change much.
PVC export volume slightly rebounded month on month in May
The export volume of PVC in May slightly rebounded month on month. According to customs data, the export volume of PVC in May was 140300 tons, an increase of 3.97% month on month and a decrease of 47.25% year on year. The cumulative export volume from January to May was 928300 tons, 8.88% lower than the same period last year, and the cumulative growth rate shifted from growth to decline.
From the export trend of this year, the export volume from January to February was at a high level year-on-year, mainly due to the strong macroeconomic expectations that stimulated the domestic PVC market since December last year, leading to a rebound in the domestic PVC market and a significant hoarding in overseas markets such as India. After the year, as the domestic PVC market returned to fundamentals and prices fell again, the enthusiasm for overseas purchases gradually weakened. The export volume gradually declined from March to April, and the decline in May was temporarily halted, but it is still significantly lower than the same period last year.
From the perspective of export trading partners, there has been little change in export destinations, mainly concentrated in South Asia, Africa, Central Asia, and Southeast Asia. The top five export destinations are India, Thailand, Vietnam, Uzbekistan, and Kazakhstan, with a total export volume of 86300 tons, accounting for 61.53% of the total export volume.
The export volume did not change much in May, which is related to changes in both China and overseas markets. On the one hand, the Chinese market continued to be weak, and exports maintained a certain volume. On the other hand, there has been a decline in exports in the US market and a phased improvement in procurement in the Indian market.
The trading volume in the Chinese market is flat, and prices are operating at a low level
Since the peak of the domestic PVC market in January 2023, prices have fluctuated and declined from February to June, with monthly average prices falling continuously. The price decline is partly due to pressure from the supply and demand side. In the first six months, the PVC supply side added 1.7 million tons of production capacity. Although the industry suffered severe losses and some marginal production capacity gradually decreased or stopped, the new production capacity and reduced production capacity were basically offset. The production from January to June is expected to be only 1.12% lower than the same period last year, while the demand side is affected by the weak real estate market, and demand continues to be weak, with high PVC inventory. On the other hand, it comes from macro pressure, with domestic recovery falling short of market expectations and poor performance of real estate data, all of which have put some pressure on the confidence of market participants.
The supply in the US market has decreased, and exports have slightly decreased
In addition to the weak Chinese market, the overall performance of the US market is poor. Domestic demand in the US continues to weaken, prices continue to decline, and export volume has increased. From January to March, the US export volume was 916000 tons, an increase of 83.57% compared to the same period last year. But in April, as the US supply side declined, exports decreased.
Periodic improvement in procurement enthusiasm in overseas markets
The overseas market mainly focuses on the Indian market. After a large amount of procurement from December last year to January this year, the purchasing enthusiasm in the Indian market has weakened in the following months, especially with a significant decrease in procurement volume from the Chinese market. The procurement enthusiasm in the Indian market is mainly influenced by the weak market conditions in China and the United States. From the end of May to mid June, there was a slight improvement in buying in the Indian market, partly due to the maintenance of some Indian enterprises and a decrease in supply, and partly due to the price returning to near the previous low.
Exports may not change much from June to July
From the end of May to mid June, domestic export orders improved and export prices fluctuated slightly. As of late June, the export price of calcium carbide PVC was 720 US dollars/ton FOB Tianjin, an increase of 15 US dollars/ton compared to early June. With the slight increase in domestic export prices, there is a lack of follow-up on subsequent orders. Except for a small number of ethylene process enterprises with stable export orders, carbide process enterprises have significantly reduced their export orders.
After a brief improvement in procurement enthusiasm in overseas markets such as India, they have also turned to wait-and-see. The Indian and Southeast Asian markets are gradually entering the rainy season, and demand will weaken slightly. The situation in the Chinese market will also affect the pace of overseas procurement. Therefore, overall, the PVC export volume from June to July may not change much.
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