There is little pressure on the supply side PVC prices are at a high level

The average starting load of PVC in July was significantly lower than expected, and it is estimated that the average start of PVC industry in July was 77.
83%, down 6.
07%
from June.
On the one hand, the load decline is due to the increase in planned maintenance enterprises, and on the other hand, the unplanned production reduction caused by the shortage of calcium carbide has increased
significantly.
It is precisely because of the obvious decline in industry starts, so the overall output decline in July is also more obvious, according to estimates, PVC production in July was 1.
8733 million tons, down 3.
02% from June, and only 4.
98%
higher than last year.

July did not come out of the obvious off-season expectations as scheduled, although downstream enterprises have huge cost pressure, there is also resistance to high prices, and heavy rain in the middle and late months has also had a certain impact on demand, but the inventory of terminal raw materials is low, and the overall demand is relatively stable
.
With the cooperation of the decrease in supply, the inventory did not show a clear increase trend, but hovered at a low level, and the sample warehouse inventory in East and South China was still lower than about 47% in the same period last year, and the overall supply of the industry was in a tight state
.

Since July, the basis has shown a significant weakening trend, with the East China basis falling all the way from about 370 yuan / ton at the beginning of the month to about
20 yuan / ton.
The reaction of the futures market to the positive is significantly stronger than that of the spot market, showing that the resistance to high prices in the downstream of the commodity market is heating up, and the weakening of the basis has become a major resistance
in the upward process of the market.
Looking forward to August, PVC supply pressure is still low, cost support remains strong, and the market will continue to fluctuate
at a high level.

The power rationing situation in August is expected to be better than in July, but under the high temperature situation in summer, power rationing may still occur frequently, plus abnormal production of calcium carbide furnaces, etc.
, it is expected that the supply of calcium carbide will continue to be unstable
.
PVC enterprises have maintenance and other phenomena, but they are relatively not concentrated, and the main thing that needs attention is still the resistance of PVC enterprises to high calcium carbide prices due to excessive cost pressure
.
Under the superposition of various factors, it is expected that the local time price of calcium carbide in August will fall back to the high level, and the overall is still at a high level
.
Overall, the tight supply of calcium carbide from August to October will continue
.

The rainy season in August will gradually end, and PVC demand is expected
to gradually recover in the future due to the delay of the rainy season.
In addition, after mid-to-late August, the high temperature weather will gradually end, and the downstream demand off-season will also come to an end
.
Overall, it is expected that the demand will remain relatively stable
from August to October.
Overall, the pressure on the PVC supply side in August is not large, the cost support is still strong, the terminal off-season will enter the end, and the inventory remains low, but the macro atmosphere is not performing well, the absolute price of PVC is at a high level, and participants have a certain fear of heights
.
It is expected that the domestic PVC spot market will fluctuate
at a high level in August.