Introduction: In the past five years, China’s PVC paste market fundamentals shifted to oversupply gradually. In 2024, both supply and demand remained decent. In the next five years, the oversupply may intensify, weighing on the PVC paste market price.

In the past five years, the supply-demand structure of China’s PVC paste market changed constantly.

In 2020, affected by the emergency, the demand for glove materials surged, leading to a notable increase in PVC paste demand. Thus, China’s PVC paste market saw a tight balance most of the time and saw the supply falling short of demand in some months. In 2021, some newly added units were put into operation, while the demand for glove materials weakened. From Q3 2021, operating rates of end industries underperformed. PVC paste demand failed to increase in the traditional peak season, and China’s PVC paste market began to see an oversupply. From 2022 to 2023, China’s domestic consumption was soft, and the supply pressure persisted, intensifying the mismatch between supply and demand. In 2024, China’s PVC paste supply rose notably, while the demand from downstream industries increased. Both supply and demand remained decent.

In 2024, China’s PVC paste industrial operating rate remained high, propping up the output. In addition, the demand from glove product industries went up, and the demand for general materials also moved up. In Q1, downstream enterprises actively stockpiled before the Chinese New Year holiday. After the holiday, the producer inventory piled up as the digestion pace of feedstock inventory was slow. From Q2 to early Q3, intensive PVC paste unit maintenance dragged down the operating rate, while the demand from glove product industries went up. In Q3, the demand was tepid. The hot and rainy weather in summer affected the operations of downstream enterprises in southern China. In addition, with the restart of PVC paste units, the market supply gained, so the supply pressure warmed up. In Q4, the PVC paste industrial operating rate remained high, while downstream demand was fairish, so the supply-demand mismatch was not obvious.

2020-2024 China PVC Paste Supply-Demand Balance Data

Unit: kt

Source: GACC, SCI

The oversupply in China’s PVC paste market may intensify in the next five years.

Capacity and output forecast: In Q4 2025, 160kt/a PVC paste capacity is expected to come online. The commissioning of new capacity may be late, which may give limited support to the annual output. In 2026, newly added capacity will possibly strengthen the supply pressure. From 2027 to 2029, some outdated capacity may be eliminated.

Import and export forecast: Overseas fundamentals and policy changes may influence import and export data. In 2025, the demand for imported glove materials and high-end general materials may be decent. However, with the commissioning of new capacity, the oversupply in the PVC paste market will likely strengthen. Thus, the import dependence degree will likely move down. As for exports, producers will actively promote exports to ease supply pressure. With the diversification of export trading partners, the export volume may remain at a high level.

Consumption volume forecast: PVC paste downstream enterprises may show different trends. The foreign demand for PVC glove products can hardly surge and remain stable. The general materials demand from the automotive industry-related industries such as back painting and interior segments is expected to be steady. The coating cloth industry will likely increase due to the demand for new product development. However, the prosperity of the leather industry may decline affected by the replacement of PU leather and other materials. The proportion of the wallpaper industry in PVC paste consumption may shrink further due to the impact of emerging products.

On the whole, the oversupply of China’s PVC paste market may worsen in the next five years, which may weigh on the market price. Exports are the key point to easing domestic supply pressure.