Implementation of BIS in India Was Delayed, Boosting China PVC Export
Preface: India’s BIS certification delay has finally been confirmed, leading to continued optimism for PVC exports in the second half of 2024. However, there remains the expectation that BIS certification will eventually be implemented, and the possibility of the anti-dumping policy being reinstated in the future. Therefore, the export market still holds uncertainties, and domestic suppliers should prepare in advance.
On the evening of August 23, 2024, Indian authorities officially announced the postponement of the implementation of the BIS certification for PVC to December 24, 2024. This long-awaited decision to delay the BIS certification policy will help ease supply pressure from China, and short-term exports may see another wave of growth.
The Progress of BIS Certification for Chinese PVC Producers
The BIS certification refers to the certification mark issued by the Bureau of Indian Standards (BIS). It involves testing and auditing products according to Indian BIS standards to obtain a certificate of conformity. On February 26, 2024, India announced quality restrictions for PVC, which were to come into effect 180 days after publication, specifically on August 26, 2024. Once effective, all PVC resins imported into India must have BIS certification.
Since Q4, 2023, Chinese PVC producers have actively started the process of BIS certification, with some producers obtaining serial numbers early on. However, progress in the factory inspection phase in India has been slow, and as the BIS certification deadline approached, no Chinese PVC producer had received the certification.
India’s BIS certification delay exerts a notable influence on China’s PVC powder market.
Since 2022, China’s PVC powder market has faced an oversupply, making exports a crucial channel to alleviate domestic pressure. Export volume has continuously increased, with 2,270kt of PVC exported in 2023, accounting for 10.87% of China’s domestic consumption.
India is China’s largest PVC trading partner. In recent years, the volume of PVC exported from China to India has grown rapidly, with a compound annual growth rate of 103% from 2019 to 2023. According to data from the GACC, China exported 1,092.9kt of PVC to India in 2023, accounting for 48.08% of China’s total exports.
From January to July 2024, PVC export volume saw a Y-O-Y increase. The total export volume from January to July 2024 was 1,460kt, up 14.96% Y-O-Y. Among these, 799.4kt resources were exported to India, a 27.5% increase year-on-year, with exports to India accounting for 54.75% of the total exports.
In February, China’s PVC prices had a clear advantage over overseas prices, leading to a surge in export orders, particularly from Indian buyers. However, as Indian demand weakened, export volume declined month by month. Especially in July and August, with the BIS certification deadline approaching, Indian buying interest weakened significantly due to policy concerns. By late August, some Indian buyers anticipated the BIS certification delay and began increasing their purchases from China once again, leading to another rise in PVC export orders.
BIS Certification Delay: China’s PVC Exports Continue to Grow
With the confirmation of the BIS certification delay, the immediate concern of obstacles to China’s PVC exports has been temporarily lifted. In the short term, PVC export orders are expected to remain high, and export volume for the H2 of the year remains optimistic.
However, looking at market patterns, after Indian buyers stockpile, they will likely enter a period of digesting this stock. Additionally, there remains the expectation that BIS certification will be implemented by the end of the year. Beyond this, the possibility of the anti-dumping policy being reinstated also exists, so domestic suppliers should continue to prepare by exploring more international markets.
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