Forecasting, though always risky, nevertheless can provide interesting fodder for debate. Witness the latest nuggets from CIT Group, which this month released its eighth annual plastics industry outlook, with projections through the year 2000.
Among the most startling: The prediction by Michael R. Paslawskyj, CIT's vice president of economic research, that in 1998 Mexico will surpass Canada as the largest foreign consumer of U.S.-made processed plastic products. ``I was flabbergasted when I saw the numbers,'' admits Paslawskyj, who has been tracking plastics industry market trends since 1991.
U.S. plastic product exports to Mexico rose nearly 20 percent to a record $2.13 billion last year, just $29 million less than the amount shipped to Canada in 1997, according to CIT.
Of course, Mexican consumers are not solely responsible for this upturn — some products are shipped south of the border for assembly and then re-exported to the United States and elsewhere. Still, the numbers represent an important shift in trade patterns that has been spurred by the North American Free Trade Agreement and by Mexico's recovery from its disastrous December 1994 peso devaluation.
No matter how you slice it, U.S. plastics processors have to feel pretty good about their prospects. CIT obviously does, given Paslawskyj's 4.4 percent growth-rate estimate for 1998 product shipments and his prediction that worldwide exports of U.S.-made plastic products will bust two records in the year 2000 — by reaching $10 billion overall, and by accounting for 7.8 percent of all such U.S. shipments.
The plastics industry, the fourth-largest U.S. manufacturing segment, continues to outpace both the U.S. manufacturing average as a whole and the gross national product. Paslawskyj also said that plastics companies identified under Standard Industrial Code 308 reported that their compensation costs in 1996 dropped to 22.7 percent of product shipments, compared with 24.7 percent in 1992 — a sign of increased productivity. And that can't be bad.