PVC main operating focus shifted down, the market wait-and-see sentiment is strong

Affected by factors such as limited power supply in Mongolia in the main producing areas, environmental protection inspections in Ningxia, and transportation controls caused by snowfall and epidemic inspections, calcium carbide prices have risen
significantly.
This year, due to the weakening of environmental protection in Ningxia, calcium carbide production has gradually returned to normal, coupled with the lucrative production of calcium carbide, the enthusiasm of enterprises for production has increased, the shortage of supply in the early stage has been alleviated, and the price of calcium carbide has also fallen
from a high level.

At present, calcium carbide prices may have a further correction, but the magnitude will not be too large
.
The main reason is that the temperature in the north this year is significantly lower than the same period of previous years, there is more snowfall in various places, coupled with the rebound of the epidemic in Hebei and other places, the transportation from the northwest to the east of China is restricted, and the structural supply shortage of calcium carbide market is difficult to solve
.

In terms of inventory, in early December last year, due to poor production and operation and shortage of raw material supply, PVC manufacturers were forced to concentrate on maintenance
.
In the same month, 8 enterprises involved a total of 2.
56 million tons / year production capacity for maintenance, and the PVC operating load fell slightly to 79.
43%.

At the same time, despite the shrinking downstream profits, given the need for large and medium-sized enterprises to ensure the supply of orders, their operating load has not dropped significantly, and PVC demand is acceptable
.
Under the combined effect of the above two factors, PVC inventories fell month-on-month and continued to increase
year-on-year.
As of December 28 last year, PVC social stocks were 105,500 tons, an increase of 28.
66%
year-on-year.
Among them, East China was 89,300 tons, a year-on-year increase of 29.
42%; South China was 16,200 tons, a year-on-year increase of 24.
62%.

In the later stage, with the recovery of calcium carbide supply, the supply of raw materials is guaranteed, and the enthusiasm of PVC manufacturers is bound to be further improved
.
As of the end of December last year, the cost of PVC calcium carbide method for calcium carbide quarried outside East China was 7140 yuan / ton, and the profit was 60 yuan / ton, and the profit was 820 yuan / ton less than the same period of the previous year; The cost of PVC ethylene process for external vinyl chloride mining was 9225 yuan / ton, with a loss of 475 yuan / ton, and the profit decreased by 834 yuan / ton
compared with the same period of the previous year.
With the recovery of calcium carbide production profits, among the eight enterprises overhauled in December last year, except for Jinchuan Xinrong equipment with a capacity of 100,000 tons/year, all have resumed production
.
Judging from the news announced, there were fewer PVC manufacturers with maintenance plans in January, and the market supply was relatively sufficient
.

On the demand side, with the approach of the Spring Festival, pipes and profiles have entered the off-season, and some enterprises choose to take turns during the Spring Festival holiday, and the operating load of PVC downstream devices is reduced
.
In addition, due to limited orders and the recent decline in PVC prices, downstream enterprises have a strong wait-and-see mood and are not willing to stock up
.
PVC is expected to be in a pattern of weak reality and strong expectations, and the short-term price will continue to pullback, but it is expected to resume the rally in the medium term
.