PVC market faces trade flow shift with China set to scrap export incentive

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China just pulled the plug on a polyvinyl chloride export incentive, and the move is set to shake up the global plastics trade.

Starting April 1, it will eliminate the 13% VAT export rebate on PVC.

Ahead of the deadline, the market expects a surge in Chinese PVC exports as companies rush to ship volumes, especially to buyers in India. But bullishness is already reflecting in prices.

Platts assessments show ethylene-based PVC FOB China rising since the announcement in January, while carbide-based PVC prices have also moved higher.

After the rebate goes, the story flips. 

Market participants expect export costs to rise, overseas shipments to slow, and some low-end carbide-based plants to shut down, thus tightening supply.

In the long-term market, sources say slower exports and reduced capacity could lift FOB prices further, while domestic prices may soften amid local oversupply.

And this isn’t just about taxes. 

It’s a part of China’s “anti-involution” strategy to cut inefficient capacity, ease intense price competition, and reshape the PVC market.