PVC2601 Contract: Price Game
PVC Futures Analysis: On October 22nd, the PVC2601 contract saw mainly narrow price fluctuations in the night session, with a relatively small range. The futures price began to fluctuate upward in the morning session, reaching a high of 4734 in the morning session before falling slightly from that high in the afternoon.
The PVC2601 contract opened at 4695, reached a high of 4734, and a low of 4685, with a spread of 49. Opening prices increased by 3,089 lots, bringing the total open interest to 1,194,995 lots. The settlement price was 4706, compared to yesterday's settlement price of 4699, up 7%. Daily trading volume was 535,541 lots. Deposited funds: 3.947 billion yuan, and inflows: 26.89 million yuan.
Regional Price Summary: Yuan/ton
PVC Spot Market: The mainstream transaction prices in the domestic PVC market continued to adjust slightly, with some traders tentatively raising prices. Comparing price estimates: North China saw a 30 yuan/ton drop, East China saw a 10 yuan/ton drop, South China saw a 10 yuan/ton increase, Northeast China remained stable, Central China saw a 10 yuan/ton increase, and Southwest China saw a 20-30 yuan/ton increase.
Upstream PVC manufacturers continued to offer stable ex-factory prices, with some companies slightly increasing prices by 20 yuan/ton. The spot market continues to fluctuate frequently. Today, bids from all sides tentatively increased slightly, but actual trades still saw some margin concessions, resulting in minimal changes in basis. Basis quotes for the 01 contract in East China were -(50, -100, -130), in South China -(0, 20, -50), in North China -(300, -350, -390), and in Southwest China, for some sources, -(200, -330).
Spot market transaction prices have largely remained consistent with previous levels, and trading volume remains dominated by small, just-in-time purchases. Downstream purchasing activity remains subdued, resulting in light trading.
PVC Market Forecast:
Futures: PVC 2601 futures prices are still consolidating between the middle and lower bands. While price fluctuations are narrowing, they lack sufficient direction. In our previous forecast, we considered the current price range to be volatile, with both negative and positive factors relatively limited, and insufficient adjustments in market volume.
Today, positions increased slightly, with 23.8% of long positions compared to 23.4% of short positions. Technically, the Bollinger Bands (13, 13, 2) are narrowing, and the daily KD line is forming a golden cross. Without clear drivers, futures prices remain relatively difficult to escape from the low-level correction. In the short term, futures prices will continue to fluctuate within the low range of 4670-4750.
Spot market: The current supply and demand dynamics in the spot market remain lacking. At midday close, the main domestic futures contracts saw mixed gains and losses, and the cultural commodities index also consolidated at a low level, with a slight increase at the high point. Today's spot market saw a tentative increase in fixed-price offers, but actual trading remained largely unchanged, with small orders at low levels predominating. Basis offers remained largely stable.
As futures prices rise, the price advantage of spot prices diminishes, prompting the market to enter a wait-and-see phase. Overseas, oil prices rebounded from the five-month low reached the previous trading day, likely due to short-covering by traders, but demand concerns stemming from the deterioration of Sino-US trade relations are holding back price gains. Overall, the PVC spot market is expected to continue to adjust at a low level in the short term, absent new stimulus.
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