UNSATURATED POLYESTER MAKERS ANNOUNCE PRICES WILL INCREASE

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Three more producers of unsaturated polyester resins have announced price increases effective earlier this month, making it unanimous among the six top U.S. suppliers.

Ashland Chemical Co. of Columbus, Ohio, announced a 2 cent-per-pound increase for general-purpose resins, and a 4 cent increase for specialty resins, said Mike Froman, business director for Ashland's plastics polymers division.

In addition, Ashland announced a 4 cent increase for vinyl ester. The effective date for Ashland's price hikes was Feb. 14.

Collierville, Tenn.-based Alpha/Owens Corning announced similar increases effective Feb. 19, according to Jack Roesle, vice president of sales and marketing. Roesle announced price hikes of 2 cents per pound for general-purpose resins, 3 cents for vinyl esters and 4 cents for specialty compounds.

McWhorter Inc. of Carpentersville, Ill., also announced price increases of 2 cents across the board for its unsaturated polyester products, McWhorter business manager Gerhard Bohme said. The effective date on the new prices was Feb. 17, he said.

McWhorter, Ashland and Alpha join Reichhold Chemicals Inc., Interplastic Corp. and its Silmar Resins unit, and Cook Composites and Polymers Co., who announced increases effective Feb. 1, Feb. 15 and Feb. 23 respectively.

Plastics News' price chart remains unchanged this week because buyers could not confirm all of the increases. But with most major suppliers lining up with similar strategies, some increase seems likely to stick, industry sources say.

``Virtually all the competitors in the industry are increasing prices,'' Froman said. ``We started invoicing those higher prices as of Friday's [Feb. 14] shipments.''

Suppliers blamed the hikes on increased raw material costs and rising overhead expenses.

``We've steadily invested in infrastructure for environmental health and safety,'' Froman said.

Industry analyst Joe McDermott, a management consultant for Composites Services Corp. in Cresskill, N.J., said in some cases polyester buyers already are paying the higher prices, but added the increases are selective.

``The unsaturated polyester market is uneven,'' he said. ``In segments [such as the auto industry] where there is strong demand, or a tailored resin is being used, prices will go up. In other product lines where there is a full tank car waiting for someone to buy, they're going to sell it at the old price.''

Processors are bracing for an unsteady market.

``I expect prices will be going up somewhat, but then are going to stabilize later in the year,'' said Ron Carrico, marketing manager of Morrison Molded Fiberglass Co. of Bristol, Va. ``I think the prices are as high as we'll see them. I don't think a lot of those prices can hold. I don't think we'll see a nickel-per-pound increase, for example.''

Carrico's firm, which consumes 15 million to 20 million pounds of polyester resins annually, stands to lose big if prices stay high, or even fluctuate. MMFG often prices its products well in advance and must eat cost increases if it guesses wrong on its raw materials.

``We would even be willing to pay a higher price if that meant prices were stable,'' Carrico said. ``The composites industry needs to have some kind of stability in pricing before it can really grow.''

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