15 May 2009 03:23 [Source: ICIS news]
By Ng Hun Wei
SEOUL (ICIS news)--China’s polyvinyl chloride (PVC) import volume this year could surge to its highest in five years as domestic producers kept their output low, traders and producers said late on Thursday at a major petrochemical industry conference.
PVC imports could hit at least 1.5m tonnes in 2009 based on the most conservative estimates, market sources said on the sidelines of the Asian Petrochemical Industry Conference (APIC) in ?xml:namespace>
The expected volume was 74% higher than the 2008 PVC resin imports, which totaled 861,000 tonnes based on official data from China Customs.
“Volume of PVC imports into
Official data dating back to 1995 showed that Chinese import of PVC resins hit a record high of just over 1.9m tonnes in 2001 before embarking on a general downward trend.
The decline came at a time when
Chinese PVC producers have however been badly hit by plummeting crude oil prices, traders and producers noted.
About 75% of Chinese PVC producers use calcium carbide as key feedstock, the price of which has declined far less sharply than crude oil and ethylene.
Calcium carbide price in
Unable to compete with ethylene-based PVC imports, Chinese PVC producers either slashed operating rates or shut their plants completely, resulting in an industry production rate of just 50-60% currently, producers said.
PVC imports filled the resulting production shortfall.
Chinese PVC demand, like elsewhere, had been affected by the global economic downturn, leading to nagging doubts that the import surge in Q1 2009 was partly speculation-fuelled and that buying interest could wane soon as a result.
Most PVC producers were, however, optimistic that the massive economic stimulus measures rolled out by the Chinese government would buoy real demand over the next three years.
With most of the government’s additional spending going into infrastructure, housing and reconstruction projects, these should help stoke PVC demand in the coming months, traders and producers said.
($1 = CNY6.82)
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|
Asian Chemical Connections