PLASTIMAGEN ’19: Mexico PVC sales slow, inventories and exports jump

Luly Stephens

03-Apr-2019

MEXICO CITY (ICIS)–Slow domestic sales in Mexico polyvinyl chloride (PVC) have driven up inventories and exports in March and early April, a source said on the sidelines of PLASTIMAGEN MEXICO 2019.

“Inventory volumes are high, as the construction sector is practically stagnant,” the source said.

Mexico’s new president, Andrés Manuel López Obrador, stopped the construction of the Mexico City airport on irregularities of contract negotiations. Talks are now under way for the potential construction of a new airport in Santa Lucia, which is about 80 kilometres north of Mexico City. The source explained that the town may not be the ideal location for an airport, as roads to and from Santa Lucia would need repair and expansion.

Declining domestic Mexican PVC demand softened prices as suppliers offered discounts to move material, but sales failed to increase.

As suppliers sought new outlets for their product, exports into Latin America jumped, with high volumes cited in Colombia and fewer offers in other producing and non-producing countries in South America.

Mexican PVC had to compete not only against US exports, but also Asian material, which saw drastic price declines in March orders driven by Taiwan’s Formosa price decrease announcement, effective for April product.

Offers of PVC pipe grade resin were heard as low as $880/tonne DEL (delivered). Export offers hovered at $770-790/FOB (free on board) Mexico and $765/tonne FOB USG (US Gulf).

Unipar Indupa, Braskem, Unipar Carbocloro, Mexichem and Pequiven are PVC producers in Latin America.

PLASTIMAGEN MEXICO 2019 takes place on 2-5 April in Mexico City, Mexico.

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