Karachi June 05 2021: Polyvinyl Chloride (PVC) prices for South East Asia decreased by USD120 per ton to USD1,390 per ton after making an all-time high of USD1,600/ton. The rise in PVC prices was witnessed due to supply constraints along with higher demand as economies was open after COVID-19. The recent decline in PVC prices is triggered by reduced demand.
On the other hand, Ethylene (PVC’s raw material) also declined by USD115 per ton to USD975 per ton. On a net basis the core delta (difference between end price and raw material price) declined by USD185 per ton to USD898 per ton.
However, the last ten-year average core delta of PVC remained below USD400/ton that said the current core delta is 2.3 times higher than its ten-year average.
In Pakistan, Engro Polymer and Chemical Limited, the only local producer, has recent increased its production capacity to ~300 thousand tons per year from ~200 thousand per year while the local demand is ~270 thousand tons per year. Higher demand (driving from higher construction activities) and increasing use (other than conventional) will increase the local demand to ~300 thousand tons in a year.