US June PVC contracts roll over May prices

12 July 2014 00:04 Source:ICIS News

HOUSTON (ICIS)--US polyvinyl chloride (PVC) contracts for June on Friday were assessed at a rollover of May prices.

Some buyers said they had received unspecified concessions from producers and a couple said that their prices lowered. But the majority of customers accepted May pricing levels.

Steady supply and demand dynamics were the reason after several months of rising feedstock costs and constrained supply that had sent prices up by almost 9 cents/lb during the first quarter.

The ICIS assessed prices remained at 71-75 cents/lb ($1,565-1,653/tonne)  for pipe-grade material and 73-77 cents/lb for general purpose material.

The steady prices are a relief to buyers who are facing price increase announcements from producers for August.

 Most buyers said that producers are targeting rollovers for the July contract, as well.

Producers are seeking the price increases on tight supply and rising costs for ethylene. A two-month postponement of the return to operation of a couple of major ethane crackers and unplanned outages at others has contributed to a sentiment of short supply for that feedstock.

Spot prices for ethylene jumped during the week, but contract prices, which guide feedstock costs, are up only slightly.

Short supply has been the guiding factor in the market since the early part of the year with plant outages, pipeline problems and other factors pushing production down and prices up.

Major US PVC producers include OxyVinyls, Axiall, Formosa, Shintech and Westlake Chemical.
By Bill Bowen