China's PVC hits record-high on supply concerns due to power-consumption curbs

China's domestic polyvinyl chloride market hit a record-high Sept. 22 following the Mid-Autumn Festival holiday, due to concerns over supply after the government ordered some provinces to cut power consumption, market sources said.

China's ethylene-based PVC price jumped Yuan 300/mt week on week to be assessed at a record Yuan 10,500/mt Sept. 22, while carbide-based PVC jumped Yuan 250/mt to a record Yuan 10,200/mt, according to S&P Global Platts data.

Several provinces including Xinjiang, Ningxia, and Shaanxi, where major carbide-based PVC producers are based, were asked to shut, or reduce industrial operations due to higher-than-planned energy consumption in the first half of 2021, according to sources. China is the world's largest PVC producer, and about 80% of its total 25-26 million mt/year PVC capacity uses coal-based carbide as feedstock, with the rest using ethylene-based feedstock.

"Carbide-based PVC operations are particularly affected as major carbide-based PVC makers are based in these provinces," a market source said.

In Xinjiang, the two major carbide-based PVC producers -- Xinjiang Zhongtai and Xinjiang Tianye -- have a combined PVC capacity of around 3 million mt/year, Platts reported earlier.

Offers for FOB China cargoes also rose in the week started Sept. 20, in line with the bullish local China market, sources said.

Ethylene-based PVC cargoes traded at $1,520/mt FOB China Sept. 22, about $70/mt higher than the previous week, market sources said.