Corrected: India PVC to stay firm as ADDs on imports take effect

19 June 2014 07:39 Source:ICIS News

Correction: In the ICIS news story headlined " India PVC to stay firm as ADDs on imports take effect" dated 19 June 2014, please read in the third paragraph ... $1,130/tonne CFR (cost and freight) India ... instead of ... $1,330/tonne CFR (cost and freight) India .... A corrected story follows.

Focus story by Veena Pathare and Kite Chong

India PVC to stay firm as ADDs on imports take effectSINGAPORE (ICIS)--Polyvinyl chloride (PVC) prices in India may remain firm following implementation of antidumping duties (ADDs) on imported material from key suppliers, market sources said on Thursday.

ADDs ranging from $14.95-189.99/tonne on PVC imports from the US, EU, Mexico, China, Japan, Indonesia, Thailand, Malaysia and Taiwan took effect on 13 June 2014 and will remain in place for five years.

On 13 June, PVC prices were assessed at an average of $1,130/tonne CFR (cost and freight) India, unchanged from the previous week, according to ICIS data.

Limited availability of ADD-exempt material is expected to cap any significant declines in the currently high PVC prices in India, an importer said at the sidelines of the World Chlor-Alkali conference in Singapore.

PVC prices in India have been on a three-year high since late April, buoyed by strong pent-up demand following the release of the revised ADD structure early that month.

India had determined that ADDs will be imposed on PVC imports on 7 April, but the notification of implementation came more than two months later on 14 June.

A severe shortage of feedstock vinyl chloride monomer (VCM) among local manufacturers, following plant outages and maintenance at a major Middle Eastern supplier also supported the high PVC prices in India in April-May.

Over a two-month period from late April, PVC prices have gained 8%, according to ICIS data.

Initial hopes that prices will come off from highs towards end-June as domestic facilities resume normal production were dashed with the implementation of the ADDs.

India imports an average of around 80,000 tonnes of PVC on a monthly basis. During peak demand season, the country’s PVC import volumes rise to 100,000 tonnes or higher, while in the traditionally lean monsoon season, demand dips to around 55,000-60,000 tonnes, industry sources said.

In the first half of the year, India imported significant volumes of carbide-based PVC from China ahead of the announcement of the revised ADD structure.

Given the massive ADDs imposed on cargoes of Chinese origin, India’s imports of these material are expected to taper off soon.

PVC cargoes from China are levied ADDs of $91.27-147.96/tonne the highest rate slapped for cargoes of Asian origin. (Please see table below)

Imports from major supplier Formosa Plastics were exempted from the ADDs in India, although smaller producers in Taiwan are subject to $33.62-61.25/tonne when exporting PVC in the south Asian country.

Taiwanese Formosa and South Korean LG Chem supply more than half of India’s PVC import requirements.

Iranian PVC is also ADD-exempt but deals on these cargoes are usually done on cash-advance payment basis.

In the fiscal year ending March 2014, India’s PVC consumption stood at around 2.26m tonnes, of which 1.25m tonnes or 55% were derived from domestic production, while the rest came from imports.

The World Chlor Alkali conference is held in Singapore and will end on 20 June 2014.

Origin

Applicable ADDs

Taiwan

$33.62-61.25/tonne

China

$91.27-147.96/tonne

US

$29.99-115.54/tonne

Indonesia

$70.58/tonne

Thailand

$48.21/tonne

Malaysia

$42.92/tonne

Japan

$14.95/tonne

EU

$39.65-189.99/tonne

Mexico

$88.10-163.05/tonne

Additional reporting by Ajoy K Das

By Veena Pathare