[Introduction] The PVC export volume decreased significantly in April, partly due to the continued weakness of the domestic market, and partly due to poor purchasing enthusiasm in overseas markets such as India. From the situation of export orders received in May and the enthusiasm for overseas procurement, it is expected that the PVC export volume will continue to be low from May to June.
PVC export volume significantly decreased in April
The export volume of PVC in April continued to decline. According to customs data, the export volume of PVC in April was 135000 tons, a decrease of 37.16% month on month and 51.51% year-on-year. The export volume from January to April was 788000 tons, 4.69% higher than the same period last year.
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 decreased from March to April.
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, Egypt, Uzbekistan, Kenya, and the United Arab Emirates, with a total export volume of 75700 tons, accounting for 56.12% of the total export volume.
The export volume significantly decreased in April, partly due to the weak impact of the Chinese and US markets, and partly due to poor enthusiasm for overseas procurement.
The trading volume in the Chinese market is flat, and prices continue to decline
Since the peak of the domestic PVC market in January 2023, prices have fluctuated and decreased from February to May, with monthly average prices falling continuously. The decline in prices is partly due to pressure from the supply and demand side. In the first five months, PVC supply side added 1.3 million tons of production capacity. Despite severe industry losses and some marginal production capacity gradually reduced or stopped, the new production capacity and reduced production capacity were basically offset. From January to May, the year-on-year production was still high, while the demand side was affected by the weak real estate market, and demand continued to be weak, resulting in high PVC inventory. On the other hand, it comes from macro pressure, as the domestic recovery has fallen short of market expectations and the real estate data has performed poorly, which has a certain impact on the confidence of market participants. The domestic market has a significant impact on the international market, and the enthusiasm for overseas procurement is also greatly affected.
Poor demand in the US market and increased exports
In addition to the weak Chinese market, the overall US market has also turned negative. Domestic demand in the US has continued to weaken, prices have continued 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. The significant increase in US exports has put some pressure on the supply side of the international market.
Weak 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.
Exports will continue to be low from May to June
In the short term, it is still difficult to see a significant improvement in PVC exports. On the one hand, there is no significant turnaround in the domestic market, and on the other hand, the enthusiasm for overseas procurement is still not good.
In May, the domestic PVC export market continued to be weak, and export prices continued to decline. As of late May, the export price of calcium carbide PVC had dropped to 720 US dollars/ton FOB Tianjin, a decrease of 55 US dollars/ton compared to the end of April, and the price of ethylene method was slightly higher by 10-20 US dollars/ton, with a similar decline. Export trading volume continues to be weak, with the exception of a few ethylene based enterprises that have stable export orders, while carbide based enterprises have very limited export orders. It is understood that as of late May, the pending delivery volume of domestic PVC exports has decreased to around 120000 tons.
The procurement enthusiasm in overseas markets such as India is still not good. The Indian and Southeast Asian markets are gradually entering the rainy season, and the demand for goods will weaken. The situation in the Chinese market will also affect the pace of overseas procurement. Once the rebound in the Chinese market is clear in the later stage, the enthusiasm for overseas procurement will also improve.
