FocusBearish Europe Nov PVC down €5-10/t

23 November 2007 23:59  [Source: ICIS news]

By Adal Rafiq

LONDON (ICIS news)--Pressure continued to mount on European polyvinyl chloride (PVC) producers this week as November business was assessed down €5-10/tonne ($7.42-14.83/tonne) across Europe on slowing demand and ample supply, market sources said on Friday.

There was some consensus on the general direction of business this week, as bearish tones continued to be heard from buyer sources across Europe. Some sellers agreed, but added that the drop was restricted to a maximum of minus €5-10/tonne below October numbers.

Minus €15/tonne was exceptional, sellers said.

Most agreed that the UK had proved exceptional, with several sources reporting that pressure from the weakness of sterling against the euro had kept prices stable in comparison with the mainland.

European spot numbers were assessed stable at €840-910/tonne on a FD (free delivered) EU (European Union) basis according to global chemical market intelligence service ICIS pricing.

Further decreases were expected for December spot and monthly business. Some sellers, however, said they may look to increase prices for December, particularly in Italy, based on expectations of higher ethylene prices and the possibility of a prolonged supply disruption.

Buyers, however, continued to remind suppliers of the increasingly worrying global economic situation. PVC, so dependent on the construction industry for demand, will be heavily impacted.

“It is a very nervous time for us at the moment,” said one seller.

“We don’t know where the ethylene contract will settle, but it could well be an increase. This is all crystal ball gazing, but if so, we may have to try and push for an increase in December. That will be very difficult,” the source added.

($1 = €0.67)

By: Adal Rafiq
+44 20 8652 3214

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