APLA ’08: Confusion lifts from Brazil PVC market

16 November 2008 18:54  [Source: ICIS news]

RIO DE JANEIRO (ICIS news)--After a period of intense price volatility, buyers have been returning to the polyvinyl chloride (PVC) market in Brazil this week as import values stabilise, a trader said on Sunday.

The sudden drop of export prices from PVC producers in the US and Asia and the wildly fluctuating exchange rate of the Brazilian real against the US dollar have made some market players wary of taking a position in the market during the last several weeks, the trader said on the sidelines of the 28th Latin American Petrochemical Annual Meeting (APLA).

Domestic PVC production in Brazil has also curtailed as demand wanes, and with less imported vinyl resin coming into the market, many PVC compound producers halted their operations due to the sudden shortage of vinyl resin, the trader said.

“Some just told their employees to go on a vacation until the market returned to normal,” the trader said.

Yet buyers who were otherwise concerned about having to sell PVC resin at a lower price than it was purchased for have felt a renewed sense of confidence, and production has resumed at companies that make vinyl siding, flooring, pipes and other PVC goods, the trader said.

However, the impact of the current economic downturn on Brazil’s PVC market remained uncertain, and investment in the industry has already begun to ebb, the trader said.

PVC producers in Brazil include Solvay and Braskem.

The 28th edition of the conference opens on Sunday and ends on Tuesday.

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Author: Greg Holt
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