It is predicted that in 2005 China's PVC demand will exceed the 8.5 million tons mark, and the total production capacity is expected to reach 10.3 million tons, 1.8 million tons more than the total demand, and the imbalance between supply and demand has further increased. From 2003 to the second half of 2004, the vast majority of the plastic profile industry was at a loss. The PVC industry has already seen a clear oversupply and will face reshuffle in the industry.
Since October 2004, the PVC market price has started to decline from the peak of 9,200 yuan/ton, and after entering the PVC market in 2005, the PVC market has not risen as much as people think and has been relatively weak. By May, the PVC market price has fallen to the bottom, and the minimum factory price has dropped to around RMB 5,500/ton. Although it has picked up recently, the margin is also very limited. The overall performance of this year's market was not satisfactory. Basically, the excessive expansion of PVC caused excessive supply. The price drop is due to the fact that new domestic devices have been put into production too densely, and for the purpose of grabbing the market, low-level prices are being “washed outâ€. Future PVC market will continue to be affected in many ways. The most important influencing factors are the following:
Capacity expansion factors. 2004 and 2005 were two years of concentrated expansion of domestic PVC production. At the end of last year, PVC production capacity was 6.638 million tons, and it has reached 9.342 million tons to date, of which 6.426 million tons for calcium carbide, 2.88 million tons for ethylene, and a total capacity increase of 40.7%. Although the production and demand of the chlor-alkali industry have been relatively strong in the past two years, all varieties are in a period of rapid development and the industry's profits have increased steadily. However, in the long run, due to excessive expansion, it will inevitably lead to increased competition and bring about fundamental changes to the market outlook. The negative effect of oversupply will be even more pronounced. Therefore, the decision-makers of enterprises should face the issue of PVC expansion and expansion, and should be more aware of this.
Raw materials and demand factors. At present, calcium carbide is still in a state of oversupply, but as the domestic energy, including coal and electricity prices, has risen step by step, the raw material market for calcium carbide has also faced no small pressure, and the already difficult-to-maintain calcium carbide companies will face even more severe survival. Difficulties, so the market price will be adjusted. In addition, international oil prices have been fluctuating at high levels and have a significant impact on the prices of imported ethylene/VCM/EDC. This has negatively impacted domestic manufacturers of imported ethylene and EDC/VCM, and will not bring too much positives to the PVC market. influences. There is a demand for the construction industry and the newly developed household heat-resistant electronic products, anti-static PVC alloys, cable composites, fiber-reinforced products, and packaged hard film products, but the downstream demand growth cannot match the increase in upstream production by more than 40%. . Recently, the European Union's anti-dumping measures on Chinese footwear and the restrictions on the export of Chinese toys have also made PVC footwear and toy manufacturers suffer, and PVC demand has also dropped. Although this year's PVC raw material prices are relatively cheap, downstream product processing companies have accelerated their production expansion, but it is difficult to form a strong support for PVC demand in the short term.
Macro-control and policy factors. As the calcium carbide process has gradually accelerated the pace of energy expansion, the large amount of CO2 recovery and management has faced an urgent problem. The national macro-control policies, environmental protection policies, investment policies, and energy issues will continue to be one of the key factors in triggering fluctuations in PVC prices in the domestic market. At the same time, as the country's macro-regulatory role in the real estate industry gradually emerged, the demand for PVC in the building materials industry has begun to decline significantly, which has exacerbated the imbalance in supply and demand in the PVC market.
High oil price factor. It is estimated that international crude oil will not break away from high levels in recent years. With raw material prices soaring, ethylene production companies will also be in huge losses.
There are many factors affecting the ups and downs of the PVC market, but the most critical and most influential one is, of course, the supply of PVC. The PVC industry has already begun to experience the "bitter consequences" of the expansion. If you continue to expand production, the market will be further affected, prices can only continue to decline, or even fall to the lowest level in recent years, so the future of the PVC market is worrying.
As China's PVC market becomes more open, especially with the participation of foreign companies and joint ventures, market competition will become even more intense. Intensifying structural adjustment and realizing intensive management are the major trends in the development of PVC industrial production. After large-scale integration, those old, small, and old production companies were either eliminated or merged and reorganized.
Since October 2004, the PVC market price has started to decline from the peak of 9,200 yuan/ton, and after entering the PVC market in 2005, the PVC market has not risen as much as people think and has been relatively weak. By May, the PVC market price has fallen to the bottom, and the minimum factory price has dropped to around RMB 5,500/ton. Although it has picked up recently, the margin is also very limited. The overall performance of this year's market was not satisfactory. Basically, the excessive expansion of PVC caused excessive supply. The price drop is due to the fact that new domestic devices have been put into production too densely, and for the purpose of grabbing the market, low-level prices are being “washed outâ€. Future PVC market will continue to be affected in many ways. The most important influencing factors are the following:
Capacity expansion factors. 2004 and 2005 were two years of concentrated expansion of domestic PVC production. At the end of last year, PVC production capacity was 6.638 million tons, and it has reached 9.342 million tons to date, of which 6.426 million tons for calcium carbide, 2.88 million tons for ethylene, and a total capacity increase of 40.7%. Although the production and demand of the chlor-alkali industry have been relatively strong in the past two years, all varieties are in a period of rapid development and the industry's profits have increased steadily. However, in the long run, due to excessive expansion, it will inevitably lead to increased competition and bring about fundamental changes to the market outlook. The negative effect of oversupply will be even more pronounced. Therefore, the decision-makers of enterprises should face the issue of PVC expansion and expansion, and should be more aware of this.
Raw materials and demand factors. At present, calcium carbide is still in a state of oversupply, but as the domestic energy, including coal and electricity prices, has risen step by step, the raw material market for calcium carbide has also faced no small pressure, and the already difficult-to-maintain calcium carbide companies will face even more severe survival. Difficulties, so the market price will be adjusted. In addition, international oil prices have been fluctuating at high levels and have a significant impact on the prices of imported ethylene/VCM/EDC. This has negatively impacted domestic manufacturers of imported ethylene and EDC/VCM, and will not bring too much positives to the PVC market. influences. There is a demand for the construction industry and the newly developed household heat-resistant electronic products, anti-static PVC alloys, cable composites, fiber-reinforced products, and packaged hard film products, but the downstream demand growth cannot match the increase in upstream production by more than 40%. . Recently, the European Union's anti-dumping measures on Chinese footwear and the restrictions on the export of Chinese toys have also made PVC footwear and toy manufacturers suffer, and PVC demand has also dropped. Although this year's PVC raw material prices are relatively cheap, downstream product processing companies have accelerated their production expansion, but it is difficult to form a strong support for PVC demand in the short term.
Macro-control and policy factors. As the calcium carbide process has gradually accelerated the pace of energy expansion, the large amount of CO2 recovery and management has faced an urgent problem. The national macro-control policies, environmental protection policies, investment policies, and energy issues will continue to be one of the key factors in triggering fluctuations in PVC prices in the domestic market. At the same time, as the country's macro-regulatory role in the real estate industry gradually emerged, the demand for PVC in the building materials industry has begun to decline significantly, which has exacerbated the imbalance in supply and demand in the PVC market.
High oil price factor. It is estimated that international crude oil will not break away from high levels in recent years. With raw material prices soaring, ethylene production companies will also be in huge losses.
There are many factors affecting the ups and downs of the PVC market, but the most critical and most influential one is, of course, the supply of PVC. The PVC industry has already begun to experience the "bitter consequences" of the expansion. If you continue to expand production, the market will be further affected, prices can only continue to decline, or even fall to the lowest level in recent years, so the future of the PVC market is worrying.
As China's PVC market becomes more open, especially with the participation of foreign companies and joint ventures, market competition will become even more intense. Intensifying structural adjustment and realizing intensive management are the major trends in the development of PVC industrial production. After large-scale integration, those old, small, and old production companies were either eliminated or merged and reorganized.
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