North American prices for suspension PVC and polypropylene resins moved in different directions in January.
Regional PVC prices increased by an average of 3 cents per pound, while PP prices ticked down an average of 1 cent. The PVC move was the result of tighter supplies and of processors building inventories in advance of spring construction.
Construction activity in the U.S. was stronger than expected in late 2019. Rigid pipe and other construction applications account for more than half of PVC consumption in the U.S. and Canada.
Market sources said that U.S./Canadian PVC sales were down around 2 percent in 2019, due in part to early-year softness in some construction sectors, including fencing and decking.
Regional PVC prices had relatively few increases and decreases during 2019 and ended up flat for the year. Most recently, prices for the material fell 1 cent in November.
PVC maker Westlake Chemical Corp. added almost 640 million pounds of new annual resin capacity in late 2019. Shintech Inc. and Formosa Plastics Corp. USA are expected to add a total of almost 940 million pounds of annual capacity in 2021.
For PP, the 1-cent January price drop was the result of improved supplies of propylene monomer feedstock and of relatively soft early-year demand.
During 2019, North American PP prices declined by a net of 9.5 cents per pound. Most recently, prices for the material declined 2.5 cents in December.
North American PP sales were up less than 2 percent in 2019. Factoring out exports left domestic demand slightly negative for the year. PP maker Braskem is adding just over 1 billion pounds of annual production in La Porte, Texas, in the second quarter of 2020.