PVC prices in Mexico could rise on tight feedstock supply

28 May 2009 23:30  [Source: ICIS news]

HOUSTON (ICIS news)--The temporary maintenance shutdown of a polyvinyl chloride (PVC) feedstock plant in Mexico could help push local prices higher in the coming weeks, PVC producers and traders said on Thursday.

Petroleos Mexicanos’ (Pemex) 400,000 tonne/year capacity vinyl chloride monomer (VCM) plant at the Pajaritos petrochemical complex near the Gulf port city Coatzacoalcos had shut down for annual maintenance in mid-May and was unlikely to resume production until the end of June, a source close to the company said.

The maintenance turnaround has compounded Mexico’s shortage of VCM - the immediate feedstock of PVC - because the tight chlorine supply in the US has limited exports of the feedstock to Mexico, which does not produce enough VCM to fuel its PVC industry, a trader said.

VCM is produced from roughly equal parts of chlorine and ethylene.

“Chlorine production rates have also fallen in Mexico due to low [co-product] caustic soda prices, which has kept VCM production rates low at the Pemex plant,” the trader said.

Domestic polyvinyl chloride (PVC) prices in Mexico were assessed last week at $800-850/tonne (€576-612/tonne) DEL (delivered), according to global chemical market intelligence service ICIS pricing.

PVC producers in Mexico include Mexichem and Cydsa.

($1 = €0.72)

For more on PVC, visit ICIS chemical intelligence
To discuss issues facing the chemical industry, go to ICIS connect

By: Greg Holt
+1 713 525 2653

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