The construction industry has long promised growth opportunities to the plastics industry — a potential not always met because of the cyclical impact of recessions on the construction segment of the economy.
Such is not the current problem.
The most recent study by Frost & Sullivan, a Mountain View, Calif., high-technology research firm, forecasts a 4 percent compound annual rate of growth through 1999. That corresponds to an earlier view expressed by Freedon ia Group in Cleveland.
As of 1994, thermoplastics accounted for 65 percent of construction industry plastics sales, thermosets 32 percent and engineering plastics 3 percent, according to Frost & Sullivan.
The firm says supporting market growth is increasing customer demand for pipes and fittings, profile extrusions and home-maintenance applications.
The U.S. market is predicted to increase from 1994's $6.1 billion to $7.5 billion by 1999. Helping to support the increase are public works projects.
That's the good news. The bad news is that there are significant cost and regulatory pressures in the United States as environmental groups and agencies push for safer products while the construction industry demands lower prices.
The story is qualitatively different in Asia and the Pacific Rim. China, for example, promises huge market potential with a population of more than 1 billion.
China Business Digest recently noted that the country's Ninth Five-Year Plan calls for the construction of 150 new cities and about 3,000 towns by 2000.
The country's use of plastic, particularly PVC, is expanding proportionally to the construction work being done and the rising price of plywood.
China also happens to have a significant number of plastics plants and produces a lot of PVC resin. When its supply sharply exceeds Chinese domestic market demands, North American producers will face an other problem. So will Greenpeace.