In the first quarter of this year, the PVC market has been in a sluggish state. Up to now, there has been no significant improvement in the downstream demand of PVC, and customers have purchased more on demand. The reporter learned last week from major calcium carbide, chlor-alkali, and PVC production companies throughout the country that due to factors such as overcapacity and sluggish downstream consumption, the current PVC price war is very cruel, and the market competition is grim. The upside in the second quarter is extremely limited; It is also difficult for cost support to lower its price.
On April 19th, the mainstream quotes for PVC materials for electric stone are: Northwest 6580~6660 yuan (ton price, the same below), East China 6700~6750 yuan, South China 6750~6800 yuan; the mainstream price of vinyl material PVC is: East China 7000~7250 yuan, South China 7100 to 7250 yuan.
This year, the new PVC production capacity will usher in a period of rapid growth, and it is expected that the new production capacity will reach 5 million tons. Among them, the fastest growing Midwest region will add 3 million tons of capacity this year. This has further exacerbated the already serious excess capacity.
By the end of 2011, China's PVC production capacity reached 21.62 million tons (including 740,000 tons of paste resin), and the cumulative annual production in 2011 was 12.952 million tons. Overcapacity has led to the PVC industry operating rate has been low, the data show that PVC has been operating for 4 consecutive years below 60%. On the other hand, overcapacity also forced PVC prices to linger on the cost line for a long period of time, even leading to widespread corporate losses.
In March this year, China's PVC production was 1.116 million tons, an increase of 7.4% year-on-year, and cumulative production from January to March was 3.277 million tons, a cumulative increase of 9.8% year-on-year. 80% of China's PVC plant is a calcium carbide process. Since the beginning of this year, sales of caustic soda market have been very good. Liquid chlorine products are generally unmarketable. In view of the chlor-alkali balance in the production process, chlor-alkali enterprises are forced to expand their PVC production, resulting in a continuous supply of PVC. new highs.
The real estate industry is the main source of PVC consumption, accounting for 60% of the total consumption. Statistics released by the National Bureau of Statistics in mid-April showed that from January to March this year, the national comprehensive real estate index for the real estate development industry was 96.92, down 0.97 percentage points month-on-month and down 6.06 percentage points year-on-year. The real estate regulation in the past two years can be said to be worse for the PVC market demand. Since March of this year, although the real estate market has picked up slightly and the volume of transactions has slightly increased, the overall market is still in decline.
In the future, national regulatory policies and measures are not expected to be cancelled, and real estate investment continues to be curbed. It is difficult for the overall consumption demand of PVC to be released on a large scale, prices are unlikely to be broadly strengthened, and the upward channel resistance is large.
At the same time, the Chinese government has already lowered its 2012 economic growth target to 7.5%. In the first quarter of this year, domestic GDP growth has dropped to 8.1% year-on-year, hitting a new low in more than two years. The lowering of the national economic growth target will slow the growth of PVC market consumption.
At present, PVC production mainly includes calcium carbide method and ethylene method. The upstream raw materials are calcium carbide and ethylene. Since the beginning of March, calcium carbide prices have oscillated upward. The calcium carbide process PVC companies face two attacks, and even PVC companies sell at below-cost prices. The losses are relatively large, and the price of PVC is basically no longer reduced. Fortunately, the high price of caustic soda to a certain extent to make up for the loss of PVC production, so that the overall cost of PVC business pressure.
Ethylene PVC is also the case. Since the beginning of this year, crude oil prices have continued to rise due to international geopolitical factors. By mid-April, the New York Mercantile Exchange crude oil futures held steady above 104 US dollars per barrel. Authoritative agencies predict that this year's oil prices will temporarily soar to US$140 per barrel as demand increases and supply tightens. Ethylene PVC prices also face a "dilemma."
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