18 May 2012 22:00 [Source: ICIS news]
HOUSTON (ICIS)--Georgia Gulf, a major US producer of polyvinyl chloride (PVC) has rescinded its earlier price initiative of 2 cents/lb ($44.09/tonne, €34.83/tonne), and a 1 cent/lb temporary voluntary allowance (TVA), a source said on Friday.
The source cited decreased domestic demand and the falling price of primary feedstock ethylene as reasons for rescinding the price initiative.
Meanwhile, another producer was said to have also rescinded a 3 cent/lb increase, also set for implementation in May, but that was not confirmed. A source at Shintech said it does not plan to alter its own 3 cent/lb May increase.
Contract prices for pipe-grade PVC are assessed by ICIS at 68-63 cents/lb. General-purpose PVC is assessed at 60-65 cents/lb.
Domestic demand for PVC has dampened as market participants wait to see if the key home construction sector will begin to rebound this year.
On Thursday, May spot prices for ethylene traded at 51.75 cents/lb, down by 18% since the start of the month, putting spot prices below contract prices for the first time in 2012. Contracts are priced 55.25 cents/lb, based on the April settlement, as the US monomer settles at the beginning of the month for the preceding month.
Major US chlor-alkali producers include Formosa Plastics USA, Georgia Gulf, Shintech, Occidental Chemical (OxyChem) and Westlake.
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Additional reporting by William Lemos
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