PVC Resin SG5 Recent Market Intelligence Report

I. Price Dynamics
- Latest Spot Price: As of May 25, 2026, the market price for premium-grade PVC resin SG5 stood at RMB 4,720.00 per ton. Regional quotations varied—for instance, Henan Qianyuexing Chemical Technology Co., Ltd. quoted RMB 4,400/ton in Shanxi and RMB 4,350/ton in Inner Mongolia.
- Futures Price: As of May 25, 2026, the latest PVC futures price was RMB 4,914.00 per ton, indicating supportive influence from the futures market on spot prices.

II. Supply-Demand Situation
- Supply Side:
- Domestic PVC capacity additions in 2026 are limited, with minimal new capacity expected overall—primarily ethylene-based plants.
- Industry operating rates are projected to remain within a rational range; aging facilities are being phased out more rapidly, and policy-driven capacity rationalization is accelerating, thereby moderating supply growth.
- Although social inventories remain elevated, destocking momentum is expected to strengthen, with Q2 2026 anticipated to mark the inflection point for inventory reduction.
- Demand Side:
- The real estate sector—the largest end-use segment for PVC—is expected to bottom out and rebound in 2026, with narrowing declines in new construction starts and recovering demand growth for pipes and profiles.
- Infrastructure-related demand is strengthening, notably in municipal pipelines and power engineering projects, serving as a key domestic demand pillar.
- Export markets are expanding steadily: Indian demand continues to grow robustly; Southeast Asian markets remain stable; and production shutdowns across Europe, Japan, and the U.S. have created supply gaps—contributing to an anticipated increase in China’s PVC export volume.

III. Market Sentiment and Trading Activity
- Market Sentiment: Current sentiment remains weak, reflecting a dual-weakness scenario in both supply and demand, resulting in downward pressure on pricing. However, as supply-demand imbalances gradually ease and policy support effects become increasingly evident, market sentiment is expected to improve progressively.
- Trading Activity: Recently, PVC futures have exhibited a volatile but generally weak trend, albeit with limited downside potential. Spot market activity remains sluggish, with downstream buyers adopting a just-in-time procurement strategy and actual transaction volumes remaining subdued.

Analysis and Assessment

I. Price Trend Analysis
- Short Term: Amid dual weakness in supply and demand and persistent inventory pressure, PVC resin SG5 prices are expected to consolidate in a sideways-to-lower pattern, with further downward adjustment possible in the spot market.
- Medium Term: As capacity rationalization takes effect, infrastructure project commencements accelerate, and the export season peaks, the supply-demand balance is poised to improve—supporting a price recovery. Spot prices may break above the previous high of RMB 5,000/ton.
- Long Term: Following a slowdown in demand growth, prices will likely enter a phase of consolidation and stabilization, returning to a rational equilibrium range.

II. Supply-Demand Imbalance Analysis
- While current supply-demand imbalances in the PVC market remain pronounced, signs of alleviation are emerging. On the supply side, output restrictions, production cuts, and accelerated capacity rationalization are curbing incremental supply. On the demand side, real estate recovery, infrastructure investment, and export growth collectively contribute to inventory absorption.
- Future progress in resolving this imbalance hinges critically upon the pace of real estate sector recovery, the implementation and execution of infrastructure investment plans, and the sustainability of export market expansion.

Forecast

I. Price Forecast
- PVC resin SG5 prices in 2026 are forecast to follow a “decline first, then rise” trajectory: consolidating at a low base in the short term; rebounding during the medium term as supply-demand fundamentals improve and policy support gains traction; and ultimately stabilizing within a reasonable range over the longer term.

II. Market Trend Forecast
- Capacity Rationalization: 2026 will serve as a pivotal year for structural adjustment in China’s PVC industry, with accelerated retirement of outdated facilities and intensified policy-led capacity optimization significantly improving the overall supply-demand landscape.
- Demand Growth: Real estate sector stabilization and recovery, coupled with enhanced infrastructure support, will constitute the primary drivers of domestic demand growth. Concurrently, steady export expansion will provide strong supplementary demand support.
- Inventory Reduction: With constrained supply and improving demand, Q2 2026 is expected to mark the turning point for inventory drawdown; by year-end, social inventories are projected to return to rational levels.