SunSirs: China PVC Prices Rebounded slightly Last week (June 9-13)

According to the monitoring of the commodity market analysis system of SunSirs, last week (6.9-13), the PVC spot market reversed its decline and the price rebounded slightly. As of last Friday, the average price of SG-5 PVC carbide method in China was 4,950 RMB/ton, an increase of 1.17% during the week.

Supply side: Last week, the PVC spot market atmosphere improved, reversing the previous decline. This week, driven by the crude oil and futures markets, the spot market slightly climbed. The market performance has improved in terms of supply and demand. Last week, the PVC operating rate remained stable, and companies that had previously reduced their operating costs have taken actions to increase their costs, resulting in a slight increase in operating rates. This is mainly based on the increase in trading volume and the improvement of market sentiment.

In terms of inventory, there has been a temporary increase in transaction volume in the market recently, and social inventory continues to decrease. However, considering the previously large basic inventory, the current spot supply side remains abundant.

Cost side: Last week, the market price of calcium carbide remained stable, and the market entered a bottoming stage. According to the monitoring of Business Society, the weekly increase or decrease of calcium carbide was zero. The increase in downstream procurement volume has a certain stimulating effect, and the linkage between upstream and downstream has led to a rebound trend in PVC prices. As of now, the quotation range for PVC SG5 electrical aggregate in China is mostly around 4,650-4,750 RMB/ton.

The PVC analyst from SunSirs believes that PVC supply is still sufficient in the short term, and the operating rate of manufacturers this week is generally higher than last week. Although the inventory of enterprises continues to decrease, the process is slow. 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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