02 May 2013 05:28 [Source: ICIS news]
SINGAPORE (ICIS)--Polyvinyl chloride (PVC) producers in the Gulf Cooperation Council (GCC) have dropped their offers of May shipments by $60-70/tonne (€45.60-53.20/tonne) from April prices, market sources said on Thursday.
Sources said that the offer prices of May-shipping cargoes were lowered to match Asian and US offers to the region.
Offers in the United Arab Emirates (UAE) market from a regional producer were heard at $1,000/tonne DEL (delivered) UAE for May lots.
Offers to other countries in the GCC region could not be confirmed, but sources estimate this to be at $1,000-1,010/tonne DEL GCC.
The drop in May prices followed the $90-100/tonne reduction in the producers’ offers for April shipments.
In the East Mediterranean (East Med) market of Jordan, offers of GCC-origin cargoes were at $1,020/tonne DEL Jordan. According to regional importers, a GCC producer also offered price discounts of up to $20/tonne for cash advance payments and bulk bookings of 1,000 tonnes and above.
In end-April, US-origin cargoes for loading in May were offered to the GCC markets at $870/tonne FAS (free alongside ship) Houston, equivalent to $950/tonne CFR (cost & freight) GCC, with multiple deals concluded at the offered price.
These cargoes were offered to the East Med markets at $970-980/tonne CFR East Med, but drew limited response from the converters there who chose to wait for offers from the GCC producers.
May-shipping cargoes from northeast Asia were offered to the Middle Eastern markets at $900/tonne FOB (free on board) NE (northeast) Asia, equivalent to $950-980/tonne CFR Middle East, but these too, were heard to have received subdued response.
Traders in the GCC and East Med markets view the GCC offers to be extremely competitive as compared with Asian and US prices since they include all the costs involved in delivery to the customer’s facility.
Furthermore, the delivery time for these lots is much shorter as compared with US-origin cargoes which are expected to arrive only in end-June or early July, they said.
GCC producers’ offers are quoted on a DEL basis that include all the costs incurred in delivering the cargoes to the customer’s facility.
Imported cargoes, on the other hand, are quoted on a CFR basis and are subject to an additional cost of around $50/tonne for port clearing, financing and land freight.
($1 = €0.76)
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