Factbox: PVC demand falls amid coronavirus uncertainty

Demand for a resin used to make construction staples like pipes and vinyl siding has retreated in recent weeks, prompting startling price declines as PVC producers seek to unload volumes and traders scramble for buyers.

"There is demand destruction in this pandemic," a US market source said. "This is completely different than anything we've seen in the past. Now the question is how quickly we can come out of it, and how long it's going to take."

PVC's fortunes are closely tied with economic activity and GDP. PVC markets have grown much more volatile after India last week imposed a 21-day lockdown to stem the spread of the coronavirus outbreak, shutting off what had been a key market with annual PVC imports of 2 million mt to feed ambitious construction plans in the coming years.

That shutoff sent Asian producers typically dependent on supplying India to other markets, particularly China, increasing competition with US flows. That dynamic prompted heated April pricing negotiations in the US and deals that pulled pricing $185/mt lower this week to $650-$660/mt FAS Houston.

In upstream markets, US spot ethylene prices reached a new all-time low on Wednesday, falling 0.25 cent to 9 cents/lb FD Mont Belvieu, the lowest price since S&P Global Platts began assessing spot ethylene in 2004.

INFRASTRUCTURE

**Methanex announced that its Geismar 3 methanol project in Louisiana has been put on hold amid market uncertainty

**The Port of Savannah has extended Saturday truck gate closures through April for dry and refrigerated containers due to current market conditions

PRICES

Olefins

**Non-LST ethane prices fell 11.6% to 10.50 cents/gal.

**Spot April ethylene prices fell 0.25 cent to 9 cents/lb FD Mont Belvieu, while the FD Choctaw price held at 8 cents/lb.

**Non-LST propane prices fell 3.875 cents to 25 cents/gal.

**April spot polymer-grade propylene prices rose 0.25 cent to 21.25 cents/lb FD USG on Wednesday, while refinery-grade propylene was flat at 9.25 cents/lb.

Polymers

**US export PVC prices fell $185/mt week on week to $650-$660/mt FAS Houston

**Export low density polyethylene prices were stable day on day at $937-$959/mt (42.5-43.5 cents/lb) FAS Houston

**Export high density PE blowmolding fell $11/mt Wednesday to $684-$706/mt (31-32 cents/lb) FAS Houston

**Export linear low density PE butene prices fell $11/mt day on day to $684-$706/mt (31-32 cents/lb) FAS Houston

**Export homopolymer polypropylene prices were flat Wednesday at $1,058/mt FAS Houston

**Imported virgin polyethylene terephthalate was assessed $60/mt lower week on week at $866-$888/mt DDP US West Coast

**West Coast of South America spot PVC import prices fell $90/mt week on week to $765-$775/mt, while Brazilian spot PVC import prices slid $30/mt week on week to $825-$835/mt.

**WCSA spot homopolymer-grade PP prices fell $50/mt week on week to $895-$905/mt, while copolymer-grade PP fell $40/mt to $955-$965/mt; both hit record lows since Platts began assessing them in 2010.

**Brazilian pricing for homopolymer fell $20/mt week on week to $960-$980/mt while spot co-polymer was also down $20/mt, at $1,000-$1,020/mt.

**WCSA prices for HDPE film-grade declined $40/mt week on week to $785-$795/mt while CFR Brazil prices for HDPE film fell $30/mt week on week to $790-$810/mt.

**WCSA spot LLDPE prices fell $40/mt week on week to $765-$775/mt, the lowest level seen since Platts launched the assessment in 2010. CFR Brazil LLDPE butene declined $50/mt week on week to $750-$770/mt, also a record low since Platts launched the assessment in 2011.

**WCSA spot LDPE was down $30/mt week on week at $995-$1,005/mt. CFR Brazil prices for LDPE fell $10/mt to $1,000-$1,020/mt.

Aromatics

**US MTBE FOB USG prices fell 2.67 cents/gal to 55.03 cents/gal.

**April US methanol FOB USG prices were flat at 69 cents/gal on Wednesday

**US April and May benzene were assessed flat at 88 cents/gal DDP USG and 91 cents/gal DDP USG, respectively.

**Prompt-month US styrene monomer was unchanged day on day at $405/mt FOB USG, while May styrene was assessed $5/mt lower at a record-low $370/mt FOB USG.

**FOB USG April and May toluene prices fell 4 cents to 103 cents/gal.

**FOB USG April and May mixed xylene prices fell 4 cents to 103 cents/gal.

**FOB USG paraxylene prices were flat at $495/mt.

**USGC light straight-run naphtha prices fell 21% day on day to 24.25 cents/gal

**NYMEX May RBOB settled at 54.65 cents/gal, down 4.62 cents.

TRADE FLOWS

**US traders have been jockeying for lower export PVC pricing as some markets shrivel up in the fallout of India's 21-day shutdown, though some Middle East and Africa markets appear open to flows if pricing is acceptable.