A monthly series of PVC suspension resin hike announcements is continuing, as five suppliers each announced 2 cent increases that were effective May 1.
The increases were announced separately by Geon Co. of Avon Lake, Ohio; Westlake Polymers of Houston; Occidental Chemical Co. of Dallas; Formosa Plastics Corp. USA of Point Comfort, Texas; and Vista Chemical Co. of Houston.
All five companies had implemented 2 or 3 cent increases in February, and 2 cent increases in March and April.
Westlake's Nick Aquino pointed to the cost of vinyl chloride feedstock as a reason for the series of upturns.
``We've reached the crisis point to get the prices up. [PVC resin suppliers] are all going through the same thing,'' said Aquino, the company's general manager of PVC.
At Geon, ethylene and chlorine price increases are driving resin prices up, according to Rob Rosenau, the company's business director for suspension resins.
``We're still recovering prices and margins that were eroded last year,'' he said. ``But overall, the market's been stronger than most people predicted. We're seeing strong construction numbers in general and that has to be what drives what's going on in PVC.''
Tom Stevning, Formosa's business director for PVC resins, said pricing scenarios have been ``pretty intense'' so far in 1997.
``It's been tough on our customers to get hit with major increases back to back, but it's the same for us,'' Stevning said. ``Our margins had totally disappeared into the red and we have to get profitable again.''
The increases have caused the average per-pound cost of general-purpose PVC suspension resin to climb from between 33 cents and 37 cents in mid-January to its current level of 38-43 cents per pound, according to Plastics News' resin pricing chart.
The average per-pound cost for pipe-grade PVC suspension resin jumped from between 31 cents and 36 cents to 39-42 cents.
While such a series of increases is not unheard of, according to Vista sales manager Charlie Matson, it has had a marked effect on PVC production, which Matson said has slowed.
``There's no reason to make the stuff,'' Matson said. ``There's no margin in the entire chain.''