TORONTO - Polyethylene supply and demand should be balanced to tight for the first three quarters of 1997, predicted a Dow Plastics executive at Canadian Plastics magazine's recent Resin Outlook Conference held in Toronto. Not much new global PE capacity became available this year, but large increments are due on stream in late 1997 and in 1998, according to Len Azzaro, Dow's commercial director for PE.
Azzaro told delegates at the Nov. 14 conference that ethylene supply and demand are tight now, and prices of the monomer have been rising. He expects PE producers to implement a 5 cent-a-pound price hike, which has been delayed by temporary voluntary allowances, in the first quarter of 1997. Producers already raised prices three times in 1996.
A Petromont Inc. executive predicts downward pressure on high density PE pricing early in 1997, partly because processors will draw down inventories.
Pricing pressure will increase beginning in the second quarter as demand climbs, although Germain Archambault, marketing manager for the Montreal HDPE producer, said he does not expect demand to be as strong as it was for most of 1996.
Dow's vice president of sales for chemicals and plastics in the northeast United States expects polystyrene prices to soften next year, although at a slower rate than this year. Jim Burton predicted PS prices will remain stable in 1998, before tight supply starts forcing them up in 1999.
New grades of thermoplastic vulcanizates, a type of thermoplastic elastomer, will help demand for these materials grow faster than the plastics industry overall, said Judy Deutschman, a sales manager with Advanced Elastomer Systems L.P. of Akron, Ohio. Various new grades available are softer and more flexible, have high melt flow for injection molding, can bond to new substrates such as nylon 6, and require less drying because they are less hygroscopic.