I. PVC Spot: High Inventory + Weak Demand
Sample warehouse inventory in East/South China remains at 320K tonnes, +18% YoY. Inventory digestion velocity has been below 50K t/week for 6 consecutive weeks, far below seasonal norm (80-100K t/week).
East/South China PVC Prices
| Grade | Price (East China) | Weekly | Monthly | YoY |
|---|---|---|---|---|
| SG-5 (carbide-based) | 4,868.57 yuan/t (avg) | -1.22% | -2.23% | +4.08% |
| SG-5 (ethylene-based) | ~6,050 yuan/t | -20 | -1.5% | +3.2% |
II. Cost Side: Calcium Carbide Falling
Northwest carbicle main production areas utilization recovered to 78%. Carbide ex-works price fell 50 yuan/t to 3,650 yuan/t this week, reducing PVC production cost by ~60 yuan/t.
III. Policy: Anti-Involution Intensifies
On May 21, NDRC reiterated forceful anti-involution policy targeting overcapacity in high-energy, low-value-added industries (including PVC). Policy tools: energy consumption limits, environmental inspections, capacity replacement.
IV. Outlook
East China SG-5 seen at 5,500-5,800 yuan/t, range-bound and weak. Downside risk to 5,300 if inventory builds further. Upside capped at 5,900-6,000 on supply contraction from policy.
