While PVC, polypropylene and polyethylene producers have announced they intend to increase prices for their resins in February, buyers and processors say they are not taking the threats of increases seriously yet. PVC makers - Shintech Inc., Vista Chemical Co., Borden Chemicals & Plastics L.P. and Westlake Polymer Corp., all of Houston; Geon Co. of Avon Lake, Ohio; and Occidental Chemical Co. of Dallas - announced they will increase their prices 4 cents a pound, effective Feb. 1.
Separately, leading PP makers announced their own 3 cent-per-pound price increases effective either Feb. 15 or March 1, and PE producers announced 5 cent hikes for Feb. 1. The PE increase apparently has been pushed back to later in the month.
The 4 cent-per-pound increase for PVC appears to be stymied by Formosa Plastics Corp. U.S.A. of Point Comfort, Texas, which said it will increase its prices by only 2 cents a pound.
PVC buyers said they expect the other companies to drop their increases to Formosa's level if, indeed, any price increase goes into effect.
Meanwhile, executives of PVC resin companies said last week they intend to stick by their pricing announcements, because they believe inventories of resin and finished products - especially for pipe products - have fallen and orders are increasing.
``Inventories are low, and orders are good, but they are not spectacular,'' the chief financial officer of a leading PVC pipe manufacturing company said Jan. 23. He spoke on the condition that he not be identified.
``There is no question that PVC resin makers have limited capacities or that they have limited feedstocks [available to them]. The question is: What are offshore markets going to do? Period.
``Pricing [for PVC] is contingent on demand coming from China. End of story. There simply is not enough demand domestically to cause an increase in prices, and the producers need offshore demand to go up before they will be able to raise prices here,'' he added.
He pointed out that China stopped buying PVC and other raw materials in May, and that move caused prices for PVC to drop in the third and fourth quarters of 1995.
Several other pipe manufacturers said they have seen their orders rising. But eight of the 11 purchasers of PVC resins contacted last week, including executives whose companies make PVC film and bottles, said they do not see their orders rising precipitously. As a result, they said they do not expect PVC prices to increase during 1996's first quarter.
The three manufacturers who disagreed said they believe the increases will go into effect as announced by the resin makers.
Patrick Baggett, president of CMAI, a petrochemical industry consulting firm, said China may return to markets for raw materials in mid- to late February, after the lunar New Year starts.
``There was quite a bit of destocking, especially in PVC,'' Baggett said in a telephone interview Jan. 23 from his office in Houston.
``We saw a kick in demand in early December, but that sputtered out, and we are beginning to hear more inquiries [from Hong Kong and China].
``We don't envision higher export prices until March or, at soonest, after the lunar New Year, but we are seeing some ac-tivity in that region as processors are restocking their inventories. However, it really is too early for us to know if China will come back strong,'' Baggett said.
Meanwhile, six PP buyers said they were trying to determine whether a 3 cent-per-pound price increase announcement will be put into effect Feb. 15 or March 1, or at all.
As PE buyers stated previously and as PVC buyers said last week, the PP buyers are saying they do not believe that the resin producers' production capacities are being strained by current demand and, without such market pressure, they do not believe the announced price increases will take effect.