Background: The supply growth in the first half of 2023 was slow, although the new capacity was concentrated and the capacity utilization rate of production enterprises declined significantly; The domestic market demand is insufficient, the real estate market is weak in the second quarter, the export market is maintained, and the demand continues to be under pressure.
PVC production and start-up pressure in the first half of the year
In the first half of 2023, the average capacity utilization rate of domestic PVC production enterprises was about 75.33%, an increase of 1.81% compared with the second half of 2022, and a decrease of 3.59% compared with the first half of 2022. PVC production enterprises exclude the impact of routine maintenance, in the first half of this year, the load reduction of production enterprises increased year-on-year, especially in Shandong, Hebei, Henan, Shanxi and other regions, the production load of production enterprises decreased by 2-80%, individual enterprises short-term temporary parking, pulling down the capacity utilization rate of the overall production enterprises.
In the first half of 2023, PVC production in 110.763 million tons, an increase of 3.19% compared with the previous year, a decrease of 1.43%, due to the capacity base increased by 1.3 million tons compared with the first half of last year, so although the capacity utilization rate slightly decreased last year, but the production still showed an increase in the trend, the release of new production enterprises’ capacity, the market impact increased.
PVC consumption in the first half of the year decreased quarter-on-quarter, and the year-on-year increase was limited
In the first half of 2023, PVC apparent consumption in 10.2802 million tons, a decrease of 5.39% from the previous year, an increase of 1.27%, the end of the epidemic, 2023 PVC downstream industry production recovery, but affected by international trade barriers and policies, downstream flooring and other export growth slowed down, PVC downstream apparent consumption growth slowed down.
In the first half of 2023, the theoretical consumption of PVC was 9.870,500 tons, a decrease of 9.78% from the previous year, an increase of 5.14% from the same period last year. In the first half of 2023, PVC raw material exports maintained a good trend, but were affected by U.S. policy and Indian safeguard policy, export slowed down in the near middle of the year, and exports in the field of products continued to fermentate under the influence of U.S. policy. Exports of raw materials and products are slowing down; Combined with the impact of the Spring Festival holiday, the year-on-year market demand weakened. Affected by the epidemic in the same period last year, consumption areas such as real estate in East China were weak, and demand slowed down. In the first half of this year, downstream building materials enterprises concentrated on delivery orders and demand recovered from last year, and consumption increased year-on-year.
Pressure between supply and demand is unbalanced, and prices are stable and falling
In the first half of 2023, the domestic PVC market showed an inverted V shape, and the market fluctuated lower after contradicting the high point of 6600 yuan/ton, and fell to a low point of 5600 yuan/ton in the first half of June, which is also the lowest point since April 2020. On the eve of the Spring Festival in January, the market is optimistic about post-holiday demand expectations, and the intraday price of PVC market is rising. After the Spring Festival, the market resumed, downstream orders were delivered centrally, procurement was positive, and the market performed well in the first quarter; At the beginning of the second quarter, the real estate new start data was poor, downstream products companies generally reported insufficient orders, the operating rate continued to decline in the second quarter, and the demand side support was weak. Although the second quarter PVC manufacturers concentrated maintenance and load reduction scale increased, but in the weak demand superimposed new production capacity under the pressure of release, PVC market prices fell.
Supply and demand pressure continued in the second half of the year, and prices were weak
In the second half of 2023, the domestic PVC market is affected by the cost and maintenance of production growth slowed down, although the new production capacity is put in, it is still difficult to drive the production growth of PVC production enterprises, reduce production and inventory, reduce production and cost situation continues, and PVC production enterprises also ushered in a new round of capacity adjustment period, some industrial chains are short, the risk pressure pressure of small capacity began to reduce production. Even exit capacity in the future.
In the second half of the year, the demand environment is expected to be insufficient, the industry is expected to be weak and stable, the overall market demand slowed down in the first half of the year, the high expectations of weak reality continued, the product demand orders were insufficient, the construction was not high, the industry inventory continued to remain high, and the market price fluctuated back and forth in the expectations and fundamentals. Background: The supply growth in the first half of 2023 was slow, although the new capacity was concentrated and the capacity utilization rate of production enterprises declined significantly; The domestic market demand is insufficient, the real estate market is weak in the second quarter, the export market is maintained, and the demand continues to be under pressure.
PVC production and start-up pressure in the first half of the year
In the first half of 2023, the average capacity utilization rate of domestic PVC production enterprises was about 75.33%, an increase of 1.81% compared with the second half of 2022, and a decrease of 3.59% compared with the first half of 2022. PVC production enterprises exclude the impact of routine maintenance, in the first half of this year, the load reduction of production enterprises increased year-on-year, especially in Shandong, Hebei, Henan, Shanxi and other regions, the production load of production enterprises decreased by 2-80%, individual enterprises short-term temporary parking, pulling down the capacity utilization rate of the overall production enterprises.
In the first half of 2023, PVC production in 110.763 million tons, an increase of 3.19% compared with the previous year, a decrease of 1.43%, due to the capacity base increased by 1.3 million tons compared with the first half of last year, so although the capacity utilization rate slightly decreased last year, but the production still showed an increase in the trend, the release of new production enterprises’ capacity, the market impact increased.
PVC consumption in the first half of the year decreased quarter-on-quarter, and the year-on-year increase was limited
In the first half of 2023, PVC apparent consumption in 10.2802 million tons, a decrease of 5.39% from the previous year, an increase of 1.27%, the end of the epidemic, 2023 PVC downstream industry production recovery, but affected by international trade barriers and policies, downstream flooring and other export growth slowed down, PVC downstream apparent consumption growth slowed down.
In the first half of 2023, the theoretical consumption of PVC was 9.870,500 tons, a decrease of 9.78% from the previous year, an increase of 5.14% from the same period last year. In the first half of 2023, PVC raw material exports maintained a good trend, but were affected by U.S. policy and Indian safeguard policy, export slowed down in the near middle of the year, and exports in the field of products continued to fermentate under the influence of U.S. policy. Exports of raw materials and products are slowing down; Combined with the impact of the Spring Festival holiday, the year-on-year market demand weakened. Affected by the epidemic in the same period last year, consumption areas such as real estate in East China were weak, and demand slowed down. In the first half of this year, downstream building materials enterprises concentrated on delivery orders and demand recovered from last year, and consumption increased year-on-year.
Pressure between supply and demand is unbalanced, and prices are stable and falling
In the first half of 2023, the domestic PVC market showed an inverted V shape, and the market fluctuated lower after contradicting the high point of 6600 yuan/ton, and fell to a low point of 5600 yuan/ton in the first half of June, which is also the lowest point since April 2020. On the eve of the Spring Festival in January, the market is optimistic about post-holiday demand expectations, and the intraday price of PVC market is rising. After the Spring Festival, the market resumed, downstream orders were delivered centrally, procurement was positive, and the market performed well in the first quarter; At the beginning of the second quarter, the real estate new start data was poor, downstream products companies generally reported insufficient orders, the operating rate continued to decline in the second quarter, and the demand side support was weak. Although the second quarter PVC manufacturers concentrated maintenance and load reduction scale increased, but in the weak demand superimposed new production capacity under the pressure of release, PVC market prices fell.
Supply and demand pressure continued in the second half of the year, and prices were weak
In the second half of 2023, the domestic PVC market is affected by the cost and maintenance of production growth slowed down, although the new production capacity is put in, it is still difficult to drive the production growth of PVC production enterprises, reduce production and inventory, reduce production and cost situation continues, and PVC production enterprises also ushered in a new round of capacity adjustment period, some industrial chains are short, the risk pressure pressure of small capacity began to reduce production. Even exit capacity in the future.
In the second half of the year, the demand environment is expected to be insufficient, the industry is expected to be weak and stable, the overall market demand slowed down in the first half of the year, the high expectations of weak reality continued, the product demand orders were insufficient, the construction was not high, the industry inventory continued to remain high, and the market price fluctuated back and forth in the expectations and fundamentals.
Post time: Jul-07-2023