Price and market trends: US PVC contracts settle higher

14 February 2014 00:00 Source:ICIS Chemical Business

US January contract prices for polyvinyl chloride (PVC) rose 3 cents lb on 6 February as producers pushed to regain margins on rising feedstock costs for ethylene and to capitalise on strong demand and shortened supply.

The settlement of January contracts pushes the ICIS-assessed price for pipe grade PVC to a range of 65-70 cents/lb ($1,433-$1,543/tonne) and for general purpose grades to 67-72 cents/lb.

Most US producers have also announced 3 cents/lb increases for February and March, saying that demand remains strong while Axiall’s production outage at its upstream vinyl chloride monomer (VCM) unit has hampered supply.

Three producers – Westlake Chemical, Axiall and Formosa Plastics – have informed the market that they do not have material available for export because of tight market conditions. Several producers said they have had to turn spot buyers away or ask them to get onto a contract for the next month.

In a news release on 6 February, Axiall said it expects to have its VCM unit back online by the end of the quarter. Markets participants have previously said they have been told that the company hoped to have the problem solved and to lift its force majeure sometime in April. Axiall did not mention when the force majeure on VCM may be lifted in its statement.

By Bill Bowen