Lagging demand has pushed per-pound selling prices for epoxy resins down more than 20 percent in the past year, while a moderate increase in demand and pricing discipline has lifted per-pound phenolic prices about 8 percent in the same period.
U.S. epoxy sales were down almost 1 percent through October, compared with the same period in 2001, according to the American Plastics Council in Arlington, Va.
Sales into the protective coatings market, which makes up more than half of U.S. demand, were down more than 14 percent.
An executive at an epoxy maker cited a drop in large, government-funded construction as having a negative effect on coatings demand. The executive also listed industry overcapacity and competition from Asian material as reasons for the epoxy slump.
Major producers Dow Chemical Co. and Ciba Specialty Chemicals are trying to reverse the trend with price increases of 5 cents per pound that were to take effect Jan. 1. Buyers contacted said the fate of the increase was up in the air as of mid-January.
In the phenolic market, upward pricing pressure from producers such as Borden Inc., Georgia-Pacific Corp. and Dyneon LLC have boosted prices, according to several contacts.
``The biggest reason [phenolic makers] have given for the increase is negative margin on their part,'' a Midwest processor said. ``They needed the higher prices to continue doing business.''
On the Plastics News resin pricing chart, prices for general-purpose and compounded epoxies are being reduced by 30 cents per pound. In general-purpose epoxy, that means the average range has gone from $1.30-$1.42 per pound to $1.00-$1.12 per pound.
Prices of semiconductor grades of epoxy - which are more specialized and sold in smaller amounts - are not affected by the move.
Average selling prices for general-purpose phenolic are climbing from 69-79 cents per pound to 75-85 cents per pound.