MOSCOW (MRC) -- Negotiations over prices of European polyvinyl chloride (PVC) for January shipments to the CIS countries began in the middle of last week. Ethylene prices have been steady in the region for the second month in a row, on the back of which European producers rolled over their December export PVC prices for January shipments, according to ICIS-MRC Price report.
The January contract price of ethylene was agreed at the previous month's level, which theoretically allowed to talk about the steadiness of the net cost of PVC production. Strong demand for resin also remained in Europe, including demand from some export markets. And these conditions allowed to maintain high prices for resin. Most producers rolled over their December export PVC prices for January shipments, which virtually corresponded to the level of November.
In fact, there was a shortage of PVC in Europe during the whole year of 2021 because of scheduled and unscheduled shutdowns for maintenance of local producers and lower imports. Supply of PVC has begun to gradually increase in the market for the past two months of 2021, but the market is far from being saturated. In addition, interruptions in the work of some producers remain.
In January, European producers were in no hurry to adjust their export prices for the CIS countries and, in fact, maintained them in the range of EUR1,650-1,710/tonne FCA, which virtually corresponded to the level of November and December.
At the same time, it should be noted that supply of PVC for shipments from the USA has grown significantly since December. Thus, the key suppliers announced their offer prices for February shipments at USD1,700/tonne CFR and lower.