PVC powder demand is improving

October 30, 2023

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The decoration sector is currently in a traditional off-season of demand, and the weak performance of PVC prices has already priced in the fundamentals of oversupply.

Since we have already priced, what else should we worry about?

As the relaxation of policies in the real estate sector takes effect, the decoration sector will enter a period of performance recovery, and there is strong certainty of a positive demand for PVC.

Let's take a look at overseas demand.

According to customs data, the export volume of PVC in September was 224300 tons, a decrease of 16.68% compared to the previous month and a year-on-year increase of 104.61%. The cumulative export volume from January to September was 1765600 tons, an increase of 6.47% compared to the same period last year, which turned from a decrease to an increase.

Although the domestic real estate demand is not good this year, the demand for overseas markets is increasing. Our PVC production is sold to South Asia, Africa, Central Asia, Southeast Asia, and other places. Of particular concern is the Indian market, which accounted for 51% of exports to India in September.

Through double counting and comparison, we can see a strong correlation between PVC prices and changes in export volume.

In December last year, the significant increase in Indian procurement in January and February this year led to a significant increase in export volume, which was accompanied by a thousand point rebound in the domestic PVC market. After the Spring Festival, the domestic real estate market was weak, with a significant year-on-year decrease in exports in March, April, May, and June. The support for the decline in coal and crude oil on the cost side was weakened, and PVC prices fell again to test the low point on October 31. 8. In September, exports increased significantly year-on-year again, and the market also experienced its second wave of rebound. 9. After the export volume fell again in October, the price of PVC entered its third dip.

At present, there are signs of improvement in export orders, and PVC is expected to experience its third wave of strength.

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