Problems seen ahead for China’s PVC producers

23 April 2008 22:11  [Source: ICIS news]

BRIGHTON, England (ICIS news)--As global ethylene prices drop in 2008, China’s acetylene-based method of polyvinyl chloride (PVC) production will become less competitive, an industry analyst said on the sidelines of the 10th International PVC Conference on Wednesday.

China’s massive coal deposits have allowed it to continue making acetylene-based PVC, but overcapacity will drive down ethylene prices, and ethylene-based PVC production will become increasingly profitable, the analyst said.

Complicating the situation, coal is also the main source of fuel for China’s power plants, and the massive growth of the Chinese economy could create a bottleneck in the supply of coal for acetylene production, the analyst said.

Nevertheless, China has continued to build new acetylene-based PVC plants near its coal producing regions in the south and west, and overall PVC production capacity will see an enormous boost in 2008, the analyst said.

For more on PVC visit ICIS chemical intelligence

By: Greg Holt
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