US Spot PVC Streaks to A YTD Low Amid Weak Global Demand, Oversupply; Significant Market Reversal Unlikely Near Term!

Companies Mentioned: PCC Group, Chemours, Olin, Occidental, Shin-Etsu, Formosa, Orbia, Atkore, Oneok, China National Petroleum Corp (CNPC), Saint-Gobain, Abundia, Cyclyx, Vinylrecycling, The Azek Company, Westlake, Aurora, Lastique, GMS Inc, Fortress, Infra Pipe Solutions, Kodiak Building Partners, Liberty Doors & Windows, Otter Tail, PrimeSource Building Products
Commodities Mentioned: Polyethylene, PVC, Ethylene, Chlorine, Caustic Soda, Crude Oil, Natural gas, LNG, LPG,PVC, Recycled Resin, Renewable Power

Key Findings

General Thoughts: US spot polyvinyl chloride (PVC) prices in December have fallen to a YTD low in absolute terms and relative to Asia, Europe, and Brazil amid weak demand and oversupplied conditions set to persist near term.
Supply Chain/Commodities: We discuss PCC Group plants to build a chlor-alkali facility at Chemours TiO2 plant in MS, provide a few thoughts on Olin’s strategic options, and highlight relevant 4Q24 global Chlor-Vinyl news.
Energy/Upstream: We discuss North America and the Middle East holding significant advantages in Chlor-Vinyl production due to their relatively low ethylene and chlor-alkali cost positions compared to Europe and Asia.
Recycled/Renewable Polymers: We further our discussion of global challenges facing PVC recyclers and buyers amid cheap virgin resin prices and low economics favoring further delay in reaching many recycled content targets.
Downstream/Other Chemicals: We highlight generally weak global building and construction conditions in 4Q24 and our broadly cautious view toward a near-term demand revival amid still high homebuyer borrowing costs.