FocusPVC pipes gaining popularity in China - trade

19 May 2009 15:03  [Source: ICIS news]

By Ng Hun Wei

GUANGZHOU (ICIS news)--Polyvinyl chloride (PVC) pipes are rapidly gaining popularity in China and could make up more than 70% of all the country’s pipes in five years time, a leading PVC stabiliser producer said on Tuesday.

“The price competitiveness of PVC will make it more popular among pipe manufacturers while better product standards will make it more acceptable to consumers,” said Lee Jian-Feng, deputy manager of Hubei Nanxing Chemical General Factory, in Mandarin.

PVC stabilisers are added during the pipe manufacturing process to prevent the polymer from decomposing.

PVC is currently used to make around 50% of all pipes in China. Around 30% are made of polypropylene (PP) while the remaining 20% are mostly made up of polyethylene (PE), Lee said, citing industry estimates.

The latter two polymers are significantly more costly than PVC, a difference all the more striking to pipe manufacturers looking to cut costs amid the current economic downturn, he added.

Prices of PVC resin in China are currently around yuan (CNY) 6,000-6,500/tonne ($879-952/tonne) EXWH (ex-warehouse), while PE costs over CNY10,000/tonne EXWH, market sources said.

Higher product standards have also expanded PVC’s usage in China, Mr Lee said. PVC pipes in China used to be installed mainly in drainage systems but technological advances have allowed their usage in water supply systems also.

“New product types such as PVC-M [PVC strengthened with additives] are tough enough and safe enough to handle the high pressure in the water supply system. With this pre-requisite fulfilled, they can compete with PE and PP pipes in terms of product quality and yet gain an edge in terms of pricing,” Lee said.

PVC pipes manufacturers would be further buoyed by the Chinese government’s massive 4,000bn yuan stimulus package, from which a significant portion would go into improving the country’s water pipe system, Lee added.

With these stimulus measures, China was likely to produce 4m tonnes of pipes this year - the same amount as in 2008 - despite the current economic downturn, Lee said at the sidelines of the Chinaplas 2009 exhibition.

($1 = CNY6.83)

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By: Ng Hun Wei
+65 6780 4359



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