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August 05, 2016 02:00 AM

Strong first half for PVC, HDPE

Frank Esposito
Senior Staff Reporter
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    U.S./Canadian PVC resin sales soared in the first half of 2016, with regional sales of high density polyethylene seeing solid growth as well.

    PVC sales in the region grew 7.4 percent in the six-month period, reaching more than 7.8 billion pounds, according to the American Chemistry Council. Sales of PVC into export markets were up almost 14 percent in the first half, which helped boost domestic sales growth of almost 5 percent.

    The domestic PVC market benefited from a rebounding U.S. housing market. That market is on track to record around 1.2 million housing starts this year, which would be up almost 10 percent from 2015. More than 60 percent of domestic PVC sales went into construction markets in the first half.

    Sales of PVC into rigid pipe and tubing were up more than 7 percent in the first half, while sales of the material into extruded windows and doors jumped almost 20 percent.

    U.S./Canadian HDPE sales bumped up 3.5 percent to almost 9.7 billion pounds for the half, according to ACC, as export sales growth of 21 percent magnified domestic sales growth of around 1 percent. Among large domestic end markets, sales of HDPE into sheet were up more than 4 percent, while sales of the material into injection molded pails were up more than 6 percent.

    “We generally expected domestic growth to be in line with U.S. GDP growth, which was 1 percent,” an executive with one HDPE maker said of first-half results. “Organic growth clearly has been conservative, but our customers seem healthy, especially in the packaging space.”

    First-half sales for other commodity resins weren't as rosy. Regional sales of polypropylene and low density PE were up less than 1 percent, while linear low density PE sales were flat and sales of solid PS in the region slid 1.5 percent.

    For PP — including Mexico — domestic sales growth of 1 percent was weakened by a drop of almost 11 percent in export sales. Domestic PP sales were boosted by gains of almost 6 percent in sheet and of almost 5 percent in injection molded caps and closures.

    LDPE sales grew almost 2 percent in the domestic market, but that rate was weakened by a 2.5 percent drop in export sales. LDPE sales into shrink film in the domestic market grew just over 3 percent for the half.

    In the LLDPE market, sales into both the domestic and export sectors essentially were flat in the first half. Domestic LLDPE sales into food packaging film and shrink/stretch film showed signs of strength, growing 4 percent and almost 5 percent, respectively.

    The 1.5 percent dip in solid PS sales — including Mexico — took place even as sales into food packaging/food service grew more than 1 percent and sales into the electrical/electronic market grew almost 6 percent.

    Food packaging/food service accounted for almost 65 percent of regional solid PS sales for the first half, with electrical/electronic bringing in a market share of more than 9 percent.

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