Houston (Platts)--7Feb2013/343 pm EST/2043 GMT

Axiall is revising its March suspension-grade PVC price increase from 3 cents/lb to 5 cents/lb, a company source familiar with domestic PVC pricing said late Wednesday.

The cost of ethylene has been increasing dramatically since the last few months of 2012 and the company's prior price increase did not reflect that, the source said.

"We will be issuing official documentation on the increase later in the week," the source said.

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Spot ethylene values were last talked at about 63 cents/lb, up more than 13 cents since early December.

The company announced the initial 3 cent/lb increase in late January.

Major PVC producers including Westlake Chemical, Shintech, Formosa Plastics and Oxy announced a 5 cent/lb increase for March deliveries in late January. All producers were heard citing increasing feedstock costs as reason for the contract price increases.

Major traders and buyers attributed the recent spike in pricing to the bout of turnarounds that are scheduled in the near future. Formosa's 3-week planned turnaround in Point Comfort, Texas, was expected to start in late February. Axiall was heard to have a planned a 3-week turnaround of its Plaquemine, Louisiana, plant in mid-March. Shintech was also planning a 3-week turnaround in late February at its Freeport PVC plant. Lastly, Westlake Chemical's ethylene cracker expansion was expected to be completed by the end of February.

"Four of the five largest producers will be running at reduced rates in February and March. PVC price has nowhere else to go but up," one trader source said.

In PVC markets, the US prices were unchanged week on week, assessed Wednesday at 49-51 cents/lb delivered via railcar. US PVC export prices were up $5/mt for the week, assessed Wednesday at $1,005-1,015/mt FAS Houston, as four major US producers were reported sold out for February, and several traders reported spot product for any-February shipments unavailable.

Axiall Corporation is the company created by the February 1 merger between Georgia Gulf and PPG's commodity chemical business, in a transaction valued by the companies at $2.1 billion.

--Pavel Pavlov, pavel_pavlov@platts.com
--Edited by Jason Lindquist, jason_lindquist@platts.com

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