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US PVC exports drop 23.7% on year in January-October : ITC

Highlights

Export availability fell in 2021 on weather-related shutdowns, operational issues

Egypt imposes 9% antidumping duties on US PVC

US polyvinyl chloride exports in the first 10 months of 2021 dropped 23.7% from a year ago, according to data the US International Trade Commission released Dec. 8.

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The US shipped out 1.6 million mt of PVC from January through October, down from 2.1 million mt in the same span of 2020, the data showed.

PVC is a construction staple used to make pipes, window frames, vinyl siding, and other products.

US PVC exports declined in 2021 amid strong domestic demand and supply kept tight largely because of weather-related shutdowns, in addition to turnarounds and operational issues. That pull in domestic demand has dominated lower overall PVC availability, reducing typical outflows.

Canada remained the top export market for US PVC, having received 470,689 mt in the 10 months of 2021, up nearly 26% from 374,004 mt in the year-ago period.

However, outflows to China fell sharply to 19,737 mt in the 10 months of 2021 compared with 221,860 mt in the same span of 2020. Market sources attribute that plunge to arbitrage being largely closed to Asia throughout 2021. Asian prices have trended lower than those in the US throughout the year because of record-high freight rates out of the region.

Mexico was the second-largest destination for US PVC exports in the January-October period of 2021, having received 228.928 mt, or 14% of all outflows.

Egypt imposes antidumping duties on US PVC

Egypt was the third-largest export market, having received 86,393 mt, or 5.3%, of the total, the ITC data showed.

In 2020, Egypt was the fourth-largest export market for US PVC. The US shipped 184,445 mt to Egypt in 2020, or 7.5% of 2.45 million mt exported that year, ITC data also showed.

Egypt's Ministry of Trade and Industry announced Dec. 6 that new antidumping duties of 9% of the CIF value — which includes costs, insurance, and freight — of US-origin PVC imports would be imposed, according to a ministry announcement.

The announcement said the duties would be imposed for five years.

Ibrahim al-Seginy, assistant minister for economic affairs and head of the ministry's Trade Remedies Sector, said in a statement that the move came upon receipt of recommendations from an advisory committee that had investigated Egyptian manufacturers' claims that US PVC imports hurt the domestic industry.

"I'm just thinking the Egyptian government is killing the goose that lay the golden egg," a US market source said.

US PVC export prices rose 42% from $1,450/mt FAS Houston in December 2020, when Egypt's antidumping duty investigation began, to $2,065/mt FAS in November 2021. US PVC export supply availability has been tight since August 2020, when the first of two hurricanes hit Louisiana within six weeks of each other, exacerbated by widespread shutdowns amid a deep freeze that hit the US Gulf Coast in mid-February 2021 and Hurricane Ida's Aug. 29 landfall in Louisiana.

But prices have retreated from that record high. US export PVC was last assessed at $2,005/mt FAS Dec. 1, down nearly 3% from the previous week.

Export PVC prices in other regions show similar surges and recent declines. The FOB NWE PVC price ended 2020 at $1,340/mt and surged 49% to $2,000/mt by Nov. 24, S&P Global Platts data show. The CFR Turkey marker was assessed at $1,450/mt in December 2020 and jumped more than 43% to $2,080/mt by Nov. 24. They were last assessed Dec. 1 at $1,960/mt and $2,040/mt, respectively, down 2% from Nov. 24 levels.

Asian PVC prices ended 2020 at $1,160/mt CFR China, $1,210/mt CFR Southeast Asia and $1,440/mt CFR India. They were assessed Oct. 20 at $1,750/mt, $1,800/mt, and $1,900/mt, respectively, after China imposed energy consumption limits that spurred supply concerns because of rate cuts and some shutdowns.

Those concerns have since eased, however, and prices were last assessed Dec. 8 at $1,410/mt CFR China, down 19% from Oct. 20; $1,455/mt CFR Southeast Asia, down 19% from Oct. 20; and $1,610/mt CFR India, down 15% from Oct. 20, Platts data showed.

While Asian prices notably lag those in other regions, record-high freight rates have limited flows to other regions, market sources said.

US market sources expect PVC supply to remain tight through the first quarter of 2022 amid upcoming turnarounds. Producers also have not fully restocked inventories because both domestic and export demand has remained strong throughout 2021 amid weather- and operations-related production interruptions, sources said.