Asia PVC markets seek equilibrium as Chinese surplus clutters cost-push narrative

The Asian PVC market is currently balanced between rising cost pressures and persistent oversupply from China. While higher energy costs and geopolitical tensions in the Middle East have pushed offers upward, abundant Chinese supply continues to cap significant price gains. As the market enters March 2026, developments in China’s export policy and India’s infrastructure demand could influence the market’s direction.

China’s export tax policy to reshape supply dynamics

China’s decision to abolish the 13% VAT export rebate on PVC, effective April 1, 2026, is expected to raise export costs by more than $75/ton. In the short term, this has led to increased export activity as suppliers rush to ship volumes before the deadline. However, once rebate-supported shipments are exhausted, Chinese export prices are likely to rise, potentially lifting regional price floors and reducing downward pressure on global PVC markets.

India’s infrastructure push expected to support demand

India is preparing for stronger PVC demand as infrastructure projects accelerate under initiatives such as the Jal Jeevan Mission. Large tenders for PVC pipes and fittings are expected in the coming months, which could increase consumption and tighten supply. Market participants believe rising import costs and stronger procurement activity could gradually strengthen pricing momentum in India.

Cost pressures and supplier hikes support bullish sentiment

Higher crude oil and ethylene costs have supported firmer PVC offers across Asia. A major Taiwanese producer raised March PVC prices by $40/ton, bringing offers to $650/ton FOB Taiwan and $720/ton CIF India and China. PVC import prices have risen significantly since December, increasing by about $80/ton in India and $90/ton in Southeast Asia, reflecting tightening supply and stronger pricing strategies from producers.

Chinese oversupply continues to limit price rally

Despite rising costs and bullish signals, ample Chinese supply remains a key factor preventing sharp price increases. Chinese producers report stable prices and cautious market sentiment as activity gradually resumes after holidays. The availability of competitively priced Chinese cargoes continues to moderate upward price momentum across Asia.

Market outlook remains balanced

The Asian PVC market remains in a state of equilibrium, with upward pressure from rising costs and potential demand growth balanced by structural oversupply from China. The removal of export rebates in China and expected infrastructure-driven demand in India could gradually strengthen market fundamentals. However, sustained price increases will depend on how quickly excess supply is absorbed and regional demand improves.

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