Beijing October 01 2021: Engro Polymer And Chemical (EPCL) is likely to benefit as China’s domestic polyvinyl chloride market hit a record-high following the Mid-Autumn Festival holiday, due to concerns over supply after the government ordered some provinces to cut power consumption, market sources said.
China’s ethylene-based PVC price jumped Yuan 300/mt week on week to be assessed at a record Yuan 10,500/mt Sept. 22, while carbide-based PVC jumped Yuan 250/mt to a record Yuan 10,200/mt, according to S&P Global Platts data.
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Several provinces including Xinjiang, Ningxia, and Shaanxi, where major carbide-based PVC producers are based, were asked to shut, or reduce industrial operations due to higher-than-planned energy consumption in the first half of 2021, according to sources. China is the world’s largest PVC producer, and about 80% of its total 25-26 million mt/year PVC capacity uses coal-based carbide as feedstock, with the rest using ethylene-based feedstock.
“Carbide-based PVC operations are particularly affected as major carbide-based PVC makers are based in these provinces,” a market source said.
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In Xinjiang, the two major carbide-based PVC producers — Xinjiang Zhongtai and Xinjiang Tianye — have a combined PVC capacity of around 3 million mt/year, Platts reported earlier.
Offers for FOB China cargoes also rose in the week started Sept. 20, in line with the bullish local China market, sources said.
Ethylene-based PVC cargoes traded at $1,520/mt FOB China Sept. 22, about $70/mt higher than the previous week, market sources said.
