China PVC Powder Industry Inventory Rose After Holiday
Preface: After the National Day holiday, China’s PVC powder industry inventory rose notably. Higher supply-demand pressure weighed on the PVC powder market.
PVC supply-demand pressure usually intensifies during the holiday. PVC producers keep production stable during the holiday, while downstream enterprises halt production affected by the festival. Thus, after the holiday, PVC suppliers often face higher pressure. However, the growth rate in PVC inventory sees a difference.
The growth rate in PVC inventory after the holiday overpassed that in the last year.
According to SCI, PVC powder inventory (plant inventory + social inventory in East China and South China) rose by 97.6kt compared with that before the National Day holiday, and increased by 48.38kt Y-O-Y.
PVC Powder Inventory Change Before&After Holiday Comparison
The increment in capacity and relatively high operating rates are the main reasons for higher inventory pressure. China’s domestic demand fails to improve significantly due to the soft real estate industry.
The base of capacity has been significantly expanded.
In H1, 2023, newly added 1,700kt/a PVC powder units came on stream intensively. The 100kt/a PVC unit at Changzhi Huojia Industry underwent a technical transformation and at present produces PVDC. At the beginning of October, China’s total PVC powder capacity is 28,020kt/a, up 1,600kt/a from the end of 2022.
China Newly Constructed PVC Unit Status
The PVC powder industrial operating rate climbed amid improved profits.
First, as caustic soda prices moved up, gross profits at chlor-alkali integrated enterprises were relatively high. Second, the annual routine maintenance is coming to an end.
2022-2023 Industry Operating Rate and Profits During Holiday Comparison
Relatively high profits at chlor-alkali integrated enterprises prop up the overall valuation of the industry. However, PVC powder supply-demand pressure is high at present. In addition, macro atmospheres in foreign markets were bearish during the holiday, dragging down the market sentiment.
All information provided by SCI is for reference only, which shall not be reproduced without permission.
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