MOSCOW (MRC)--Negotiations over March shipments of suspension polyvinyl chloride (SPVC) began in Russia between producers and converters this week, with the former targeting price hikes from February, according to the ICIS-MRC Price report.
The growth in prices of suspension PVC in the Russian market began in January and March will be the third month of resin appreciation.
Despite the low seasonal demand for PVC and finished products, local producers managed to balance the domestic market.
In addition, a two-week scheduled shutdown of production from the largest supplier, RusVinyl, is planned in April. This will affect the balance of the Russian market in the near future.
Some Russian producers announced a price increase of roubles (Rb) 3,000/tonne ($44/tonne) from the February level.
The current strengthening of the rouble exchange rate against the dollar does not save the situation for Russian consumers. Prices for imported PVC continued to be much higher than Russian resin, although the trend will possibly change.
PVC prices have risen sharply in Asia since December, with a maximum reached two weeks ago. There is a certain pause after the China Lunar New Year holidays in China.
Price offers for acetylene resin from key Chinese suppliers were in the range of $920-960/tonne DAP (delivered at place) Moscow by mid-February.
Taking into account the current strengthening of the rouble against the dollar makes the prices of Chinese PVC not less than Rb68,000/tonne DDP (delivered duty paid) Moscow, including VAT.
Demand for PVC from Russian consumers in January-February was seasonally low due to a similar situation in the finished goods market. But some converters bought PVC in excess to smooth out the price growth for the next months.
Demand for finished products is not expected to increase significantly in March, however demand for PVC will improve in the domestic market, especially given the small volumes of imports and the forthcoming shutdown of the largest producer.
Overall, deals for March shipments are discussed in the range of Rb65 500-67 500/tonne CPT (carriage paid to) Moscow, including VAT, for K=65/67 and for volumes up to 500 tonnes, which was up by Rb2,000-3,000/tonne from February.
Negotiations on prices for resin with K70 started from Rb65,500/tonne CPT Moscow, including VAT, and reached Rb68,000/tonne CPT Moscow, including VAT.
($1 = Rb68.65)
MRC, a partner of ICIS, produces polymers news and pricing reports from Russia, Ukraine, Belarus, Uzbekistan and Kazakhstan.