Plastics Industry Perspective
3rd Quarter 2012
Exports & Construction pulling PVC
By Kevin Duffy
PVC resin prices fell 5% in
the quarter from an average of
$1.01 per pound to $0.96 per
pound. At the very end of the
quarter, prices jumped 3% to
$0.99 per pound. Supply and
demand are currently close to
balanced, with recent price changes mostly affected by
ethylene price fluctuations.
PVC resin sales are up approximately 4% in 2012, which includes both domestic and
foreign sales, also up approximately 4%. Housing construction is a primary contributor to
the increase in domestic sales.
Housing new starts increased
approximately 20% in 2012;
however, at approximately 725,000 in 2012, they are still
depressed from 2007 pre-recession levels of approximately 1.4 million.
North American PVC resin
sales are forecasted to finish
2012 at approximately 15 billion
pounds, which would surpass
2007 resin sales of 14.6 billion
pounds. North American PVC
is operating at about 85% of its
Export sales is the
driver pulling North
sales past pre-recession levels.
10% of North
sales in 2007 and
are projected to
account for approximately 35%
of sales in 2012.
PVC has a cost
advantage due to
lower cost ethylene feedstock derived from
new shale gas reserves helping
to increase exports
Kevin Duffy is a Senior Inventory appraiser who specializes in the plastics industry. He
has appraised numerous plastics-related companies in North America that are involved
in distributing, compounding and manufacturing resins, films, sheets, and molds. Kevin
received his B.A. in finance from Illinois State University, and passed the CPA exam in
Illinois. Kevin has diverse business experience in
accounting, banking, manufacturing,
distribution, and retail.