Japan's production of vinyl chloride monomer (VCM) hit a seven-year low in May given weaker demand, also pressuring output of polyvinyl chloride (PVC).
Production of VCM dropped by 12pc from a year earlier to 170,121t in May, the lowest since June 2016, while PVC output declined by 10pc to 108,517t, according to the Japan Vinyl Environmental Council (VEC). Production of VCM in May could have been curbed by weaker demand, higher manufacturing costs, as well as plant maintenance, VEC said.
Domestic VCM supplies totalled 113,788t, down by 13pc over the year, while PVC deliveries fell by 2.4pc to 67,738t. PVC supplies for rigid pipes dropped by 9.5pc to 18,084t, while deliveries for floor materials declined by 4.8pc to 5,071t. These falls more than offset a 5.1pc rise in deliveries of electric wires to 7,922t.
Most PVC in Japan is used in the construction sector. Construction in Japan has slowed in recent months, with the number of buildings starting construction in April dropping by 5.7pc from a year earlier to 43,163, according to the latest data by Japan's ministry of infrastructure, land and transportation.
Exports of VCM fell by 8.1pc on the year to 68,364t in May, but PVC sales increased by 8.1pc to 44,707t over the same period.
VCM inventories climbed by 72pc from a year earlier to 57,425t in May despite lower output, possibly because of reduced sales, according to VEC. PVC stocks dropped by 5.3pc to 142,293t over the same period.
