Vinyl chloride monomer: Cycles
Storms, a Chinese property slump and plant closures
What this tab covers How its prices and margins move: past booms and busts with price levels, the spread or margin that the industry watches, the drivers of the cycle and the metrics to track.VCM prices follow PVC prices and ethylene costs, with the spread squeezed when Chinese construction is weak. PVC margins were high in 2021 when US winter storms and hurricanes shut Gulf plants and building boomed; they collapsed from mid-2022 as China's property sector slumped and Chinese and US exporters competed for India and other importers. The floor is the cash cost of carbide producers in China and naphtha producers in Asia; the ceiling is set by import parity in deficit markets like India.
The spread to watch VCM or PVC minus ethylene and chlorine costVCM margin = VCM price - (0.47 x ethylene + 0.58 x chlorine netback + conversion). With PVC CFR India at $720/t and Asian ethylene in the $700s/t (Dec 2025, ChemOrbis via ethylene tile), integrated non-Chinese producers earned thin margins in early 2026 (indicative).
Booms and busts
- 2021
Winter Storm Uri (Feb 2021) and Hurricane Ida shut US Gulf chlor-vinyls; Asian and Indian PVC prices hit records.
not published here (Indian PVC reached record highs, indicative)
- 2022-2024
China's property slump turned it into a net PVC exporter; Asian prices fell; Westlake closed Lake Charles North VCM and Aberdeen PVC.
not published here
- 2025-2026
India's DGTR final findings (14 Aug 2025) recommended anti-dumping duty of $22-284/t on suspension PVC, but the Ministry of Finance did not impose it (Nov 2025). A countervailing-duty probe on Chinese PVC began on 27 Feb 2026, and from 24 Jul 2026 DGFT restricted S-PVC imports priced at or below $0.766/kg CIF for six months (Argus, Jul 2026). China revoked VAT export benefits on PVC from 1 April 2026.
Suspension PVC CFR India $720/t (25 Feb 2026, Platts)
What drives the cycle
- China construction and property. sets whether China imports or exports PVC
- Ethylene and coal prices. set route costs
- Trade remedies. India, EU, UK and Brazil duties redirect flows
- US Gulf weather. storms knock out large integrated capacity
Metrics to track
| Metric | Why it matters | Where to track it |
|---|---|---|
| PVC CFR India and CFR China | Asian benchmark and India import parity | S&P Global Platts, ICIS, ChemOrbis |
| Dalian PVC futures | Chinese sentiment | Dalian Commodity Exchange |
| China carbide prices | carbide-route cost | Mysteel, SunSirs |
| EDC fob USG and NE Asia | merchant chlorine-carrier price | Argus, ICIS |