Introduction
In the first half of the year, the domestic export arbitrage window opened for a long time and the export volume reached a new high, which differentiated some domestic sources of goods and became a powerful supplement to the demand side of PVC. However, in the second half of the year, with the closing of the export arbitrage window, the import sources gradually entered the domestic market, which brought a sustained impact on the medium and long-term market.
PVC exports increased significantly in the first half of the year
China is the world's largest producer and consumer, with PVC production capacity accounting for nearly half of the global production capacity. In recent years, China's PVC basically maintains a balance between internal supply and demand, with little dependence on export and import. Generally, there is a delicate balance between Chinese PVC and international PVC. However, since last year, due to the global epidemic and the force majeure of foreign devices, this balance has been temporarily broken, and China's imports and exports have increased significantly. Next, focus on this year, analyze and predict the changes of import and export.
From January to may 2021, China's PVC powder import volume was 146300 tons, a year-on-year decrease of 47.64%; The export volume was 972600 tons, compared with 218300 tons in the same period last year and 628800 tons in the whole year last year. Although the export volume in June this year has not been announced, it has reached a new high in recent years from the export volume data from January to May.
The export arbitrage window increased for a long time in the first half of the year. Since the third quarter of last year, the domestic export arbitrage window has been open. In the first quarter of this year, due to the impact of the cold wave in North America, many sets of PVC devices in the United States were force majeure, foreign goods were tight and prices were high, and the domestic export arbitrage space was further expanded, which stimulated the export enthusiasm of domestic PVC production enterprises, and PVC production enterprises received a large number of orders, Therefore, the whole first and second quarter is the time period for PVC manufacturers to receive a large number of export orders and deliver orders. A large number of PVC production enterprises exported, resulting in a decrease in domestic sales, which is also one of the reasons why the inventory in East / South China warehouse went to the warehouse quickly in the first half of the year, and some goods sources in the market were in a tight shortage state. Since the middle of May, the export arbitrage window has been gradually closed, and the export orders have decreased, but the final orders in the early stage are still being delivered. Therefore, it is expected that the export volume in June will fall, but it is still relatively high.
Since May, the domestic export window has been gradually closed, mainly because: in the first and second quarters, with the gradual recovery of PVC devices in the United States and the completion of maintenance of some foreign devices, the foreign PVC supply has been gradually restored. With the serious epidemic situation in Vietnam and India, the demand in Southeast Asia and South Asia has weakened, so the external market price has begun to callback; Second, when the external market price continues to fall, China's PVC market price has been high and volatile, and the export price advantage has decreased; Third, the rising of export sea freight leads to the rising of China's export cost; Fourth, India and Southeast Asia are China's main export regions. After their demand weakens, the demand for PVC powder in China decreases.
PVC imports are expected to increase in the second half of the year
While the export window was closed, on the one hand, as the external price continued to fall, China's PVC market was operating at a high level, and the import window began to open; On the other hand, when India's demand is good, India is the world's largest importer, but when India's demand is poor, the source of goods originally exported to India may flow into the Chinese market. Therefore, market participants began to pay attention to China's imports. Before analyzing China's imports in the second half of the year, make an overall forecast of the global trade in the second half of the year.
The probability of Global trade in the second half of the year is that the United States supplies goods for sales in the Americas and Asia supplies goods for Asia. Because American PVC is mainly supplied to China and South America, at present, the export price of the United States is still more than 1400 US dollars / ton, while the FOB price in Asia is mostly about 1200 US dollars / ton in the market, and at present, the shipping is tight and the price is high, so it is difficult for American goods to arrive in Asia. In Asia, we need to pay attention to the Indian market. If India's demand is good, most Asian sources still choose to sell to India. On the contrary, the Chinese market may face certain import pressure. Therefore, in the second half of the year, the import market mainly focused on the demand and price of India and Southeast Asia.
China's largest sources of imports are Taiwan, the United States, Japan and South Korea. It is unlikely that American goods will enter China in the second half of the year. Therefore, it is necessary to pay attention to the import of China's Taiwan and the import increment of Indonesia and Thailand with the rise of China's price. Because China is duty-free to ASEAN, once the export profit of China is higher, ASEAN goods will also flow into China.
Since June, we have received the news that foreign sources of goods have entered China. From the price point of view, Formosa Plastics' shipping quotation in July: CIF China is reduced by 110 US dollars / ton to 1240 US dollars / ton. Although ordinary traders have no advantages, it is heard that the write off material is about 30000 tons; In addition, Indonesia and Thailand are expected to enter China. After verification with some domestic traders, they do receive some imported materials one after another. The specific amount is not clear. Some participants said that it may be 30000-40000 tons, but the time to China is basically the end of July and August. On July 13, the shipping offer of Formosa Plastics in August was again reduced by US $30-60 / ton, FOB Taiwan by US $50 / ton to US $1190 / ton, CIF China by US $30 / ton to US $1210 / ton, and CIF India by US $60 / ton to US $1330 / ton. But it is reported that the main India is mainly India, which is active in buying, and Chinese mainland only has about 20 thousand tons of verification materials. At present, Indonesia and Thailand have heard that the offer to China is about 1200 US dollars / ton, and there is a certain arbitrage space for imports, but we need to pay attention to the specific volume.
Therefore, through the above analysis, the source of imported goods has indeed entered China one after another. The import volume will increase from July to August, but it is unlikely that the import volume will rise sharply. If China's price is high and the import window is always open, the volume of Southeast Asian goods entering China will gradually increase, and we need to continue to pay attention to the Indian market. The Indian market is full of great uncertainty, which will affect the volume of Formosa Plastics exported to China. Import is expected to increase, but recently, the domestic supply side will reduce the load due to insufficient raw materials to support the import side. Therefore, although the impact of short-term import is temporarily small, the rising import volume will also change the supply structure of domestic PVC and have a continuous impact on the price. We will also continue to track import and export and bring further analysis.
