Fundamentals did not improve significantly
After the Spring Festival, PVC prices fell significantly, until the middle of April the largest decline of 21.8%. Since then, although the PVC rebounded, but the weak pattern is not completely reversed. In terms of the second quarter, the supply and demand pattern has the potential for improved stage, but the degree of improvement also limits the upstream height. Therefore, the trend of PVC up and down are limited.
| POLYVINYL ALCOHOL |
New pattern of supply and demand pattern
First, capacity growth slowed down, supply and demand improved. Beginning in 2013, PVC industry began to self-repair capacity, then capacity decline year after year. Chlor-Alkali Industry Association data show that 2016 domestic PVC production capacity decreased by 220,000 tons, including new capacity of 890,000 tons, out of capacity of 1.11 million tons; production growth rate of 3.5%, demand growth rate of about 1%, supply and demand gradually from the imbalance For balance. According to statistics, this year plans to 2.96 million tons of PVC plant put into operation, but the actual production capacity may be less than expected. Late, the industry itself and the guidance of the policy will continue to play a role in the regulation, supply and demand continued to improve the possibility of a larger, less likely to take the blind expansion of the old road.
| POLYVINYL ALCOHOL FIBER |
Second, from a net importer to a net exporter, exports become a new bright spot in demand. 2016 domestic net exports of 389,000 tons of PVC, the continuation of the net export pattern since 2014; from January to March this year, net exports of 123,300 tons, 2016 net exports over the same period 69,600 tons, net exports expanded year on year. According to UBS forecast, China 2017, 2018 PVC exports will account for the global PVC trade volume of 1.5%, 1.6%. Although the total export volume is not large, but the growth trend will constitute a certain positive support for PVC demand.
Third, the stage of supply and demand contradiction still exist. PVC season in the second quarter will reduce short-term supply, and the traditional demand for a rebound in the supply and demand there is a stage to improve the potential. However, the second quarter of the maintenance efforts year on year poor performance, social stocks are still high year on year, thus suppressing the ring to improve the positive.
| PVA |
Chlor-alkali imbalance again
Beginning in the second half of 2016, the situation of chlor-alkali imbalance re-emerged. The fourth quarter of 2016, caustic soda downstream alumina market volume and price go up, driving demand for caustic soda, caustic soda prices rose gradually since September. Data show that the fourth quarter of 2016 caustic soda production increased by 14.3% year on year, a 6-year high year on year growth rate, the same period caustic soda (32% ion membrane) prices from 690 yuan / ton to 970 yuan / ton, an increase of about 40% Substrate (≥96%) price increase is more than 30%.
In the fourth quarter of 2016, in the calcium carbide prices higher, traffic and environmental factors such as boost, PVC also appeared in the stage of volume and price Qi Sheng situation, industry profits have also been greatly improved, the overall profitability of the caustic soda industry showed a high level The However, did not last long, this year, PVC production growth has not been effectively digested. With the calcium carbide prices and caustic soda industry, high yield, PVC production continues to increase and prices continue to fall trend. With the decline in production profits of PVC, Shandong liquid chlorine market prices once appeared 400-600 yuan / ton of the situation, the caustic soda enterprises “to fill the chlorine” state.
| PVA 0588 ( PVA BP05) |
In the short term, the caustic soda industry is driven by high profits, maintaining a high operating rate. Although the chlor-alkali plant maintenance in May increased, the output has declined, but the amount of downstream alumina is still relatively large, more aggressive procurement, liquid alkali prices to maintain high oscillation is more likely. Therefore, the short-term supply and demand in the case of chlor-alkali imbalance, PVC supply increased pressure on the price still exist, the price rise can only hope that the cost of boost and improve the consumption.
Support force still exists
In the long term, PVC is not too pessimistic. First of all, the cost of support or still have room to play. Calcium carbide prices since the beginning of the year has continued to decline in late April began to pick up (the beginning of the domestic average price of calcium carbide from 2830 yuan / ton all the way down to mid-April 2430 yuan / ton, the recent price rose 80-100 yuan / ton ).
| PVA 2088 (PVA BP20) |
Second, the seasonal consumption recovery has started. From the social inventory point of view, after the middle of April, PVC total inventory began to decline from 315,000 tons in mid-May to 27 million tons, although still higher than the 2016 stock in the same period 28.5%, but the downward trend More obvious. As the annual April to September is the PVC to the inventory stage, is expected under the action of the seasonal laws, the inventory pressure to ease the stage, the downstream consumption chain to improve the trend of the same.
Finally, in the long run, with the electrolytic aluminum industry to further promote the supply side of the structural reform is expected, do not rule out the deepening of the policy, alumina market capacity and demand decline, thereby reducing the demand for caustic soda. If the slowdown in demand for caustic soda, chlor-alkali industry operating rate decline, will ease the supply of PVC pressure. In this way, there will be a potential impact on the impact of PVC, but the specific extent of the policy is still subject to the implementation of the situation. For example, according to 1 ton of alumina corresponding to 0.241 tons of caustic soda demand, assuming that electrolytic aluminum production capacity by 5 million tons, corresponding to 9.75 million tons of alumina and 2.34 million tons of caustic soda demand, this part of caustic soda accounted for about 6% of total capacity.
Based on the above analysis, the second quarter of the late, PVC will continue the interval oscillation pattern, but the oscillation center of gravity is expected to move slightly, the price of 5300-5400 yuan / ton have some support, and the first target in the 6200 yuan / ton nearby.
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