The PVC market fell from January to June 2023. On January 1st, the average spot price of PVC carbide SG5 in China was 6141.67 yuan/ton. On June 30th, the average price was 5503.33 yuan/ton, and the average price in the first half of the year decreased by 10.39%.
1. Market analysis
Product Market
From the development of the PVC market in the first half of 2023, the fluctuation of PVC carbide SG5 spot prices in January was mainly due to an increase. Prices rose first and then fell in February. Prices fluctuated and fell in March. The price fell from April to June.
In the first quarter, the spot price of PVC carbide SG5 fluctuated significantly. The cumulative decline from January to March was 0.73%. The price of PVC Spot market rose in January, and the PVC cost was well supported around the Spring Festival. In February, the downstream resumption of production was not as expected. The PVC Spot market fell first and then rose, with a slight decline overall. The rapid decline in raw material calcium carbide prices in March resulted in weak cost support. In March, the price of PVC Spot market fell. As of March 31st, the quotation range for domestic PVC5 calcium carbide is mostly around 5830-6250 yuan/ton.
In the second quarter, PVC carbide SG5 spot prices fell. The cumulative decline from April to June was 9.73%. In April, the price of raw material calcium carbide continued to decline, and cost support was weak, while PVC inventory remained high. So far, spot prices have continued to decline. In May, the demand for orders in the downstream market was sluggish, leading to poor overall procurement. Traders would not hoard more goods, and the price of PVC Spot market continued to fall. In June, the demand for orders in the downstream market was general, the overall market inventory pressure was high, and the price of PVC Spot market fluctuated and fell. As of June 30th, the domestic quotation range for PVC5 calcium carbide is approximately 5300-5700 tons.
Production aspect
According to industry data, the domestic PVC production in June 2023 was 1.756 million tons, a decrease of 5.93% month on month and 3.72% year-on-year. The cumulative production from January to June was 11.1042 million tons. Compared to June last year, the production of PVC using calcium carbide method was 1.2887 million tons, a decrease of 8.47% compared to June last year, and a decrease of 12.03% compared to June last year. The production of PVC using ethylene method was 467300 tons, an increase of 2.23% compared to June last year, and an increase of 30.25% compared to June last year.
In terms of operating rate
According to industry data, the domestic PVC operating rate in June 2023 was 75.02%, a decrease of 5.67% compared to the same period last year and 4.72% compared to the same period last year.
Import and export aspects
In May 2023, the import volume of pure PVC powder in China was 22100 tons, a decrease of 0.03% compared to the same period last year and a decrease of 42.36% compared to the same period last year. The average monthly import price was 858.81. The export volume was 140300 tons, a decrease of 47.25% compared to the same period last year and 3.97% compared to the same period last year. The monthly average export price was 810.72. From January to May, the total export volume was 928300 tons and the total import volume was 212900 tons.

Upstream calcium carbide aspect

In terms of calcium carbide, the factory price of calcium carbide in the northwest region decreased from January to June. On January 1st, the factory price of calcium carbide was 3700 yuan/ton, and on June 30th, it was 2883.33 yuan/ton, a decrease of 22.07%. The prices of upstream raw materials such as orchid charcoal have stabilized at a low level, and there is insufficient support for the cost of calcium carbide. Some calcium carbide enterprises have begun to resume production, increasing circulation and supply. The downstream PVC market has declined, and downstream demand is weak.

2. Future Market Forecast
The PVC Spot market will still fluctuate in the second half of the year. We should pay more attention to the demand of upstream calcium carbide and downstream markets. In addition, changes in terminal real estate policies are also important factors affecting the current two cities. It is expected that the spot price of PVC will fluctuate significantly in the short term.