India demand slides for PVC and PS

India, Markets, Styrenics

By Malini Hariharan

The last year has been rough for Indian polyvinyl chloride (PVC) and polystyrene (PS) producers with demand for their products showing almost no growth.

PVC consumption is likely to increase by only 1-2% year on year in the fiscal year ending on 31 March 2012, said S Gopal, managing director of Chemplast Sanmar at the PlastIndia exhibition and conference last week.

And if things don’t go well in February-March, growth could slip in the negative zone, he cautioned. He expects demand to settle at around 1.9m tonnes for 2011-12

In polystyrene (PS), one producer expects demand to shrink by 3.5% to around 250,000 tonnes in 2011-12.

The economic slowdown, rising interest rates and depressed buying sentiment are some of the factors responsible for the slide in fortunes of both PS and PVC.

But producers are also blaming the unseasonal rains experienced in 2011.

“The low demand growth is mostly the result of an unusually heavy monsoon season,” said Gopal.

The monsoon season in India is typically a time of low demand for PVC, as pipe-laying activity comes to a halt during this period. The pipes and fittings sector currently accounts for more than 70% of PVC demand in India, in contrast to the global situation, where this sector contributes only 40% to PVC consumption.

In PS, the rains affected the appliances segment, which accounts for about 40% of demand.

“It was a bad year for the industry. India had only 45 days of summer in 2011 as against the usual 145 days. Unseasonal rains affected demand for appliances such as coolers and refrigerators,” explains a source from the local producer.

Another crucial factor for PVC was the fluctuation in the value of the Indian rupee. The rupee depreciated steeply against the US dollar in the last quarter of 2011, dampening buying interest, as imports became very expensive. India imports nearly 600,000 tonnes of PVC annually.

The setback for PVC and PS comes after a robust 2010-11 when demand growth was over 10%.


"Known Unknowns" And China


By John Richardson IF the blog had a dollar for every time we had read reports a...

Learn more

India polymer exports to Pakistan set to rise


By Malini Hariharan After years of waiting truck movement of petrochemicals from...

Learn more
More posts
Shift in supply chains away from China adds costs, complexities and risks for petrochemicals

By John Richardson AS PETROCHEMICALS and other manufacturers scramble to relocate their businesses a...

IMF confirms global economy all about China as US threat to growth persists

By John Richardson DON’T SAY I didn’t tell you. An important new IMF study confirms what I’ve ...

India must forget trying to follow China and should instead launch a Green New Deal

By John Richardson DON’T WORRY, I am told, India is on the way. As China undergoes major structura...

China’s polyethylene indigestion persists as margins point to major downturn

By John Richardson CHINA’S POLYETHYLENE (PE) market continues to display signs of chronic indigest...

China’s inland petrochemicals demand will never come anywhere close to coastal levels

By John Richardson ONE DIMENSIONAL analysis of China would have you believe that as per capita incom...

US ethylene glycols: Diversifying away from China may prove impossible

By John Richardson US BUSINESSES are making arrangements to diversify their supply chains away from ...

Plastics rubbish and the developing world: Lost petrochemicals demand and the new service-led approach

By John Richardson IT WAS billed as a liberating product, something that brought a little luxury to ...

Little prospects of genuine US and China deal leave US petrochemicals exports very vulnerable

As always, this blog post expresses my own personal views and these are not the views of ICIS. Thank...


Market Intelligence

ICIS provides market intelligence that help businesses in the energy, petrochemical and fertilizer industries.

Learn more


Across the globe, ICIS consultants provide detailed analysis and forecasting for the petrochemical, energy and fertilizer markets.

Learn more

Specialist Services

Find out more about how our specialist consulting services, events, conferences and training courses can help your teams.

Learn more

ICIS Insight

From our news service to our thought-leadership content, ICIS experts bring you the latest news and insight, when you need it.

Learn more