Russia PVC prices decrease for June shipments amid difficult negotiations

MOSCOW (MRC)–Negotiations on the Russian polyvinyl chloride (PVC) price for June delivery are proving to be difficult with producers having to reduce prices, according to the ICIS-MRC Price Report.

Negotiations on the June contract prices of Russian suspended PVC (SPVC) began last week, and at the initial stage of approval, producers announced the rollover of the May price level.

Converters did not hurry to confirm the prices and negotiations were delayed.

The active process of concluding deals began only in the middle of the last week, with converters managing to achieve a reduction in prices of roubles (Rb)1,500-2,000/tonne.

The demand for PVC in the market has been gradually growing from month to month, but the growth is not as dynamic as the growth in supply of raw materials.

SPVC supply in Russia grew by 11% in the first four months of the year compared to the same period of 2016. The excess in PVC supply began to be seen in April, when the import of acetylene PVC from China began to grow dynamically.

The imports of Chinese PVC grew even more in May and in the first three weeks of the month exceeded 11,000 tonnes. Some major Russian converters partially closed their needs for PVC through purchases in China.

The influx of imports of polyvinyl chloride forced Russian producers to take a non-traditional step for the current period of time – a reduction in prices.

Deals for June delivery were discussed in the range of Rb65,000-67,000/tonne ($1,019-1,051/tonne) CPT (carriage paid to) Moscow, including VAT for deals up to 500 tonnes.

Resin with K70 has fallen in price with deals discussed in a range of Rb66,000-68,000/tonne, including VAT, and delivery, whereas a month earlier deals were concluded in the range of Rb68,000-70,500/tonne, including VAT, and delivery.

($1 = Rb63.76)

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