PVC Recent Commodity Market Dynamics Intelligence Analysis

I. Market Dynamics
Price Trends
- Futures Market: On May 26, 2026, the main PVC futures contract price stood at approximately RMB 4,853.00/ton, reflecting a slight uptick of 0.21%. Prices across different contracts varied—for instance, the v2704 contract was priced at RMB 5,224/ton, while the v2612 contract traded at RMB 4,980/ton.
- Spot Market: Zhengzhou PVC prices edged downward slightly, with sluggish trading activity. The mainstream ex-factory delivered price for electrocalcium-process SG-5 grade stood at RMB 4,680–4,740/ton (cash basis). As of May 21, the prevailing price for SG-5 in Changzhou was RMB 4,700/ton, down RMB 200/ton week-on-week, representing a decline of 4.08%.

Supply Conditions
- Operating Rates: Starting mid-May, PVC producers entered a concentrated maintenance period; multiple units—including Shaanxi Jintai and Jinyuanyuan—were shut down for scheduled maintenance. As of mid-May, overall PVC production capacity utilization stood at 69.85%, up 0.45 percentage points MoM but down 6.34 percentage points YoY. Specifically, electrocalcium-process utilization reached 79.63% (up 1.22 percentage points MoM, up 4.82 percentage points YoY), whereas ethylene-process utilization fell to 46.83% (down 1.36 percentage points MoM, down 32.95 percentage points YoY), constraining near-term output growth.
- Inventories: Enterprise inventories declined 6.32% week-on-week; however, social inventories remained largely flat. Meanwhile, pre-sales by producers weakened, resulting in a slow inventory drawdown pace and persistent destocking pressure.

Demand Conditions
- Downstream Operating Rates: Demand remains the core weakness in the current market. Downstream end-user industries—including pipe and profile manufacturers—exhibit low operating rates, which have further declined this week. Overall operating rate for PVC downstream processing enterprises stood at 43.03%, down 1.49 percentage points MoM. Purchasing remains predominantly demand-driven, with generally muted willingness to build inventory.
- Domestic & Export Demand: The real estate sector continues to underperform, reflected in weak new construction starts—directly weighing on demand for PVC pipes and profiles. With the onset of the seasonal low-demand period, domestic demand is further suppressed and unlikely to improve significantly in the near term. By contrast, exports remain one of the few bright spots; however, the Indian tariff window is nearing expiration, limiting upside potential for export growth going forward.

Cost Structure
- Electrocalcium Process: Calcium carbide prices have held relatively firm recently, providing some cost support. Although profit margins for electrocalcium-process producers declined MoM, they rose 61.07% YoY. Some electrocalcium-process producers rapidly increased loadings, partially offsetting supply reductions caused by maintenance shutdowns.
- Ethylene Process: Cost dynamics differ markedly from those of the electrocalcium process. Tight ethylene supply has led to reduced ethylene-process plant utilization, resulting in divergent cost-support conditions compared to electrocalcium-process operations.

II. Analysis & Assessment
Short-Term Factors
- Supply Side: Concentrated plant maintenance is temporarily reducing supply and offering modest bottom support to prices. However, once maintenance concludes and plants gradually resume operations, supply pressures are expected to re-emerge.
- Demand Side: Persistent domestic demand weakness is unlikely to reverse soon. The approaching rainy season and seasonal lull will further suppress demand. Export growth faces headwinds, leaving overall demand without notable catalysts—thus failing to provide meaningful price support.
- Cost Side: While electrocalcium-process costs offer some underlying support, ethylene-process cost dynamics are more complex and less supportive. Consequently, cost factors lack unified upward pricing momentum.

Long-Term Factors
- Overcapacity: Domestic PVC capacity remains structurally excessive. As of end-March 2026, total national PVC capacity reached 29.115 million tons/year, with industry-wide utilization hovering around 75%. The persistent mismatch between installed capacity and actual demand remains pronounced—making supply-demand imbalance the dominant long-term driver of market trends.
- Industry Restructuring: Policy-driven retirement of outdated capacity is gradually optimizing supply structure and elevating effective capacity utilization, thereby facilitating better alignment between capacity and demand. Nevertheless, this is a protracted process and is unlikely to yield significant near-term market impact.

III. Outlook
Short-Term Forecast
- Price Trend: In the near term, spot PVC prices face downward pressure stemming from supply-demand imbalances. Although futures prices retain modest support, their upside is constrained by soft spot market fundamentals—leading to expectations of continued low-range consolidation.
- Market Sentiment: Trading sentiment remains subdued, with investors exhibiting strong wait-and-see attitudes and lacking clear directional conviction. Overall market activity remains low.

Long-Term Forecast
- Price Trajectory: Over the medium-to-long term, supply-demand imbalances will continue to dominate market direction. Slow inventory drawdown and persistently weak demand will keep downward pressure on prices, potentially shifting the price center lower. However, as obsolete capacity is phased out and industrial restructuring advances—and contingent upon a potential recovery in the real estate sector—the price center may gradually rebound.
- Industry Development: The sector will undergo deep structural recalibration amid the triple pressures of high costs, weak demand, and oversupply. Product substitution and premiumization will become central strategic directions. Significant import-substitution opportunities exist in high-end segments—including medical-grade PVC, food-grade PVC, and high-impact PVC—spurring domestic enterprises to intensify R&D investment, enhance product quality, and accelerate structural upgrading across the value chain.