According to the monitoring of the commodity market analysis system of SunSirs, the PVC spot market continued its upward trend from the previous week (7.7-11) and continued to climb last week. As of last Friday, the average price of SG-5 PVC carbide method in China was 4,733 RMB/ton, an increase of 1.7% during the week.

Supply side: Last week, PVC spot market prices rose. On the one hand, driven by the crude oil and futures markets, the spot market continued to climb. On the other hand, the market has shown an improvement in supply and demand. Last week, the PVC production rate remained stable, maintaining the previous level, and demand also showed a moderate rebound. This is mainly based on the increase in trading volume and the improvement of market sentiment.

In terms of inventory, the market has maintained a high trading volume recently, and the overall social inventory is in the stage of depletion. Last week, many manufacturers raised their factory prices, but the inventory pressure on the manufacturer's port is still acceptable.

Cost side: Last week, the price of calcium carbide in the market remained stable and entered a bottoming stage. According to the monitoring of Business Society, the weekly increase or decrease of calcium carbide was zero. The current increase in PVC prices is not closely related to the cost side, but mainly comes from the favorable conditions of the futures market and supply and demand improvement. The increase in downstream procurement volume has a certain stimulating effect, and PVC prices have rebounded.

The PVC analyst from SunSirs believes that in the short term, there will be sufficient PVC supply, and the operating rate of manufacturers will remain at a high level. The inventory of enterprises is still generally high, and it needs to be continuously reduced in the later stage. The rebound of short-term futures market is mainly driven by the improvement of market sentiment and the rise in crude oil prices driven by geopolitical tensions, and the lack of sustained improvement in PVC fundamentals. As downstream procurement returns to rationality, the positive support effect is not significant. We should be cautious about the magnitude of the increase.

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