Polycarbonate makers have won slight price increases in the second half of the year, while prices for suspension PVC and PET bottle resin continue to show seasonal softness as 2002 winds to a close.
Average per-pound price increases for most standard injection molding and extrusion grades of PC totaled 5 cents per pound in early fall, but subsequent price erosion put the net gain at 3 cents per pound, according to several buyers and industry sources contacted recently.
Essentially, a gain of 4-5 percent has returned to a net gain of 2-3 percent. Demand from major PC applications in information technology and consumer electronics has yet to recover to pre-2001 levels, sources said.
Many buyers were doubtful of the increases' chances for success, but major PC makers GE Plastics of Pittsfield, Mass., and Bayer Corp. of Pittsburgh were determined to boost pricing levels and improve profitability.
``[PC makers] got some increases, but not all that they wanted,'' a Michigan-based PC buyer said. ``There's not much support out there for more increases. There's also less-expensive, off-shore material available, but it's pretty much `buyer beware.' ''
The changes are indicated on this week's Plastics News resin pricing chart. Plastics News also is showing a correction in listed prices for optical-media-grade PC. Prices are being corrected from $1.81-$1.99 per pound to $1.13-$1.22 per pound for purchases of more than 1 million pounds annually.
Competition from low-price Asian PC and compact discs has played a role. In addition, many CD and digital versatile disc replicating firms are reporting operating rates of 50-60 percent because of reduced demand and market overcapacity, factors that also have driven prices down.
The PVC market saw another cent come off of prices in November. Several sources pinned the drop - which followed 1 cent drops in September and October - on seasonal slowdowns in the building and construction market.
``It's a combination of seasonal factors and people bringing down inventory at the end of the year,'' a West Coast-based PVC buyer said. ``Prices have been dropping because there's still too much inventory in [PVC] pipe.''
Through September, U.S./Canadian PVC sales were up almost 5 percent vs. 2001, according to the American Plastics Council in Arlington, Va. Factoring out a 9 percent drop in export sales leaves the domestic market with a growth rate of 6 percent.
PVC sales into siding and extruded windows and doors each enjoyed robust increases through September, with siding up about 12 percent and extruded windows and doors up more than 13 percent. Combined, those two segments accounted for about 20 percent of domestic PVC use in the first nine months of 2002.
Early-arriving cold weather played a role in the 2 cent-per-pound price drop in PET bottle resin since early September, according to several sources. Cool temperatures throughout the Northeast and Midwest affected sales of carbonated soft drinks and bottled water, two big factors in PET sales.
The North American PET market is set to be hit with more than 900 million pounds of new capacity in 2003 via expansions from M&G Group and DAK Americas Inc. Wellman Inc. recently shelved an expansion of nearly 300 million pounds set for early 2004 after having doubts about the economic success of the project.
Even with the newly reported decreases, PET bottle resin prices are up almost 7 percent from the start of the year, while suspension PVC prices are almost 41 percent above January levels, according to the Plastics News resin pricing chart.