Russian producers look for further price rises for PVC in March

MOSCOW (MRC)–Negotiations over March shipments of suspension polyvinyl chloride (SPVC) began in the Russian market this week, with producers separately announcing further price increases for shipments to the domestic market, according to ICIS-MRC Price report.

Prices of Russian polyvinyl chloride (PVC) have already risen twice in 2019, and this is expected to continue in March. Dwindling stocks and a lack of large quantities of import material are the main factors for further price increases.

Russian producers announced price increases of Rb1,000-2,000/tonne for March deliveries, depending on the resin.

The current situation is similar to the last year’s trend, when PVC prices rose monthly for Russian consumers until September, and converters were forced pass on costs.

Producer capacity utilisation is quite high, exceeding 90%, but the excess resin is actively shipped for export. However, it is worth noting that export sales have begun to decline gradually since February.

Northern China producers – key suppliers in the past – have exported limited supplies of acetylene PVC to Russia since last year, with only one o manufacturer able to partially offset costs Russia deliveries, and the limit for March shipments has already been used up.

Deliveries of acetylene PVC from China without benefits are unprofitable even taking into account the planned March price increase from Russian producers.

Some converters do not intend to increase their purchases in comparison with February, whereas other converters are looking to raise their purchases, despite weak demand for finished products. Thus, converters intend to partially hedge themselves from risks of possible price increases in April.

Overall, March deals for resin with K=64/67 were negotiated in the range of Rb74,000-76,500/tonne CPT Moscow, including VAT, up by Rb1,000-1,500/tonne from February, for quantities of up to 500 tonnes. For special grades, particularly, with K=58/70, some producers intend to achieve a price increase of Rb1,500-2,000/tonne.

MRC, a partner of ICIS, produces polymers news and pricing reports from Russia, Ukraine, Belarus, Uzbekistan and Kazakhstan.