Chinese Overcapacity: The PVC Export Machine
China's PVC capacity exceeds 30 Mt against domestic demand of approximately 20 Mt, creating a structural surplus of 10 Mt (FACT: CISA/China Chlor-Alkali Association, 2026). Operating rates have fallen to 65%.
Chinese PVC exports reached an estimated 5 Mt in 2025, primarily to India, Southeast Asia, and Africa at prices $200-300/t below US benchmarks. India has responded with anti-dumping duties (FACT: Indian Ministry of Finance, 2025).
Coal-to-PVC (calcium carbide route) accounts for 80% of Chinese production, consuming approximately 8 MWh of electricity per tonne. Electricity price increases directly raise production costs.
North American PVC: Ethane Advantage
US PVC production from ethane-based ethylene and chlor-alkali. Ethylene cost at $0.15-0.25/lb is half the cost of Asian and European competitors (FACT: IHS Markit, 2025).
US PVC exports of approximately 4 Mt/yr to Latin America (Mexico, Brazil, Colombia) and Europe. US PVC export prices of $1,000-1,100/t are globally competitive.
Shintech's Louisiana expansion added 400,000 tonnes of PVC capacity in 2025, reinforcing the US export position.
Regional Breakdown
Asia ($800-900/t): Oversupplied. China dominates. India is largest import market but AD duties on Chinese PVC reshape trade.
North America ($1,000-1,100/t): Balanced to long. Construction demand (pipe, siding) drives 70% of consumption.
Europe (EUR 900-1,200/t): Balanced. High energy costs constrain production. US imports fill gap.
Middle East: Growing PVC capacity based on low-cost ethane. SABIC and OQ expanding.
Procurement teams purchasing pvc in 2026 should prioritize supplier diversification, lock in annual volumes where possible, and monitor the shifting trade policy landscape. The structural themes outlined above will play out over 12-24 months, creating windows for renegotiation and hedging alike.