PVC to grow moderately in LatAm, Brazil to offset weak Mexico market: Orbia

PVC producer Orbia forecasts moderate growth in Latin American markets for 2026, with stronger demand conditions in Brazil expected to offset anticipated ongoing weak fundamentals in Mexico, executives said in the company's fourth-quarter earnings call.

"Market conditions are expected to remain subdued in Europe and moderate growth is anticipated in Latin America," Sameer S. Bharadwaj, CEO of the Mexico-headquartered company, said in the Feb. 25 call.

Orbia pointed to continued challenges in Mexico's construction and infrastructure sectors, which are key downstream outlets for PVC.

"Overall, global market conditions ... remained generally challenging in 2025, particularly across construction and infrastructure-related activities," as well as regionally in Mexico, Bharadwaj said.

The company expects that lower interest rates and renewed infrastructure activity could support a recovery in Mexico in 2026.

"With the reduction in interest rates and resumption of building and construction activity, and especially infrastructure projects, the operating leverage ... should begin to benefit us," Bharadwaj said.

In turn, Brazil was a "bright spot" due to the market's construction-oriented portfolio, which was providing a counterbalance to the Mexican and Western European markets, Executive Vice President and CFO James Patrick Kelly said.

Trade measures were another potential lever for the company's Polymer Solutions business in the Americas, particularly the antidumping duties from Mexico and the pending duties in Brazil, Bharadwaj said.

Platts, part of S&P Global Energy, last assessed Brazilian import prices for PVC at $805/metric ton CFR on Feb. 25.

Rationalizations, policies to counteract oversupply

Orbia expects the global PVC market to remain oversupplied, but executives said that rationalizations of production in Europe and the US, along with policy changes in China, should help keep prices elevated.

"Recent governmental policy shifts, particularly in China and announcements of capacity rationalization in Europe and the US, should help support a firmer global pricing environment," Bharadwaj said.

The company reported early signs of price recovery in the first quarter of 2026, following a challenging fourth quarter for PVC pricing.

"Even though Q4 was very challenging from a PVC pricing standpoint, we have seen a material change in Q1," Bharadwaj said.

China's elimination of VAT on certain PVC exports was also expected to further support prices, the CEO said, with the impacts expected by the second quarter.

"We've already seen the pricing of the various indexes go up by $60-$70/mt ... [and] that should start flowing through in our results as well," he added.

Platts last assessed US export PVC prices at $650/mt FAS Houston on Feb. 26.