PVC prices climbed again in April, and temporary production outages at a pair of PVC plants have given suppliers hope for additional increases taking hold in May.
Suspension-grade PVC prices climbed 1 cent per pound in April as producers settled for half of a 2 cent increase they had been seeking, according to several buyers contacted recently. Major producers are seeking additional 2 cent increases in May and June.
Demand has remained strong, leading to a 2.3 percent increase in sales through February, according to the Society of the Plastics Industry Inc. in Washington.
Sales into siding markets have led the way, showing an increase of almost 15 percent through February. Rigid pipe and tubing sales, which account for about 40 percent of the overall market, are up more than 5 percent. However, export sales were down 29 percent and flooring sales dipped almost 12 percent through February.
The market may be tightened further by shutdowns at a Condea Vista Co. plant in Oklahoma City and a Georgia Gulf Corp. facility in Plaquemine, La.
The Condea Vista plant, which produces about 400 million pounds of PVC annually, lost power May 3 when tornadoes swept through Oklahoma City. The plant was spared serious damage even though some homes in a neighborhood across the street were destroyed, Condea Vista olefins and vinyl public affairs manager Mike Reynolds said in a May 12 telephone interview.
Reynolds estimated some of the damaged homes were only 300 yards away from the plant. Workers in the plant's control room watched the tornado pass the building through outside cameras.
``Our building only suffered minor damage, but the power lines ended up somewhere in Kansas,'' Reynolds said.
The plant regained power May 6 but wasn't able to restart PVC production until May 8.
The plant already was running near capacity before the outage and ``will have to run that much harder'' to make up for lost time, Reynolds said. Condea Vista will attempt to supply Oklahoma City customers with material from its Aberdeen, Miss., site, but demand at that plant also has been extremely high this year.
``The net result is [supplies] are just going to be even tighter,'' Reynolds said.
Industry sources said Georgia Gulf lost a week of PVC production in early May because of a planned maintenance turnaround at its vinyl chloride monomer plant at the site. Georgia Gulf officials could not be reached for comment.
A Kansas-based buyer is hoping the PVC increases will be passed on to pipe buyers.
``The condition of the [PVC] industry has kept pipe prices down,'' he said. ``Now everybody's tired of not making any money.''
PVC prices, which dropped an average of 7 cents per pound in 1998, are up an average of 3 cents per pound to date in 1999.