Global Supplier Directory
Supplier Solutions
Whitepaper Library
Calendar of Events
Association Locator
Contents Pages
Market Research
Subscription Center

issue: January 2004 APPLIANCE Magazine

2004 Materials Forecasts
Plastics - Raw Materials Impact Price

 Printable format
 Email this Article

by David Simpson, Contributing Editor

Price, not availability, remains the issue in plastic materials.

2004 Materials Forecasts
Availability has not been an issue for plastics, says Walter Zimmerman, director of Consumer Refrigeration at BASF Corporation (Mt. Olive, NJ, U.S.). However, he adds, "Pricing remains as issue because raw material costs have forced all suppliers to implement increases to cover the rising costs. Pricing will continue to follow raw material costs, which have been erratic. As supply and demand get more into balance, pricing will increase slightly, beyond raw material drivers, to achieve some positive margins."

As customers face some higher costs, they are making adjustments, he says. "In plastics, there appears to be a much greater move from higher-priced materials to polystyrene in appliances as manufacturers are reducing costs to address competitive pressures," Mr. Zimmerman concludes.


The BRITA water purifier and kettle is molded from Lexan polycarbonate resin from GE Plastics (Pittsfield, MA, U.S.). According to GE, the properties this resin gives to the application are transparency, hydrolytic stability, stiffness, and high-impact strength.
" For many polymers, including ABS and SAN, 2003 was an unusual year," declares Philippe Robert, global market director for Appliances in the Engineering Plastics business of Dow (Paris, France). "Demand varied quite a bit from region to region, with Asia being strongest, except in the second quarter. Global demand was up, but on a very limited basis. Plant utilization has been below 80 percent, so supply has been adequate.

"Prices, on average, were higher in 2003," he adds. "The driving factor behind this was raw material and energy costs, with oil being a large part of it. But the big explosion in costs has been only partly compensated by the price. Because of tremendous cost pressures for the producers, there has been some restructuring taking place. Only a few other producers besides Dow Plastics now have the integrated, low-cost structure they need," Mr. Robert notes.

"ABS has been affected by raw material costs, especially styrene monomer, which is petroleum based," elaborates Brett Simpson, global product director for Copolymers at Dow (Zurich, Switzerland). "Oil has been up and down like a yo-yo due to Middle East instability and is currently at a fairly high level. Although we were able to move prices up slightly earlier in the year, we have not passed on all our higher styrene costs to our customers. Our prices should remain pretty steady to the end of 2003.

"Later this year and in 2004, more styrene capacity will be coming on stream," he continues. "This capacity is needed and will quickly be soaked up. In fact, we expect that styrene monomer will go short through 2004 and more so in 2005. Styrene prices will go up gradually in response. We do not foresee any crunch in styrene prices in the near future, but nonetheless, our margins will be under pressure. Look for gradual price increases in ABS to take account of styrene and to cover other costs."

For polyphenylene sulfide (PPS) compounds, demand decreased from 2000 to 2001, but the material has resumed its historical double-digit (10-percent) growth rates. "There has been ample capacity to handle the demand in 2003, and prices are stable relative to other polymers," observes Jay Blackburn, Ryton business development manager at Chevron Phillips Chemical Company (The Woodlands, TX, U.S.). "I see a very good outlook for 2004, with continued historical growth rates based on good general economic growth of current uses and continued new application development. Among our recent developments are PPS elastomer alloys called Xtel XE Series, which allow us to extrude and blow mold more flexible PPS-based compounds."

XT polymer acrylic-based multipolymer compounds from Cyro Industries (Rockaway, NY, U.S.) are finding applications in floor care appliances where they are used as dirt canisters, cleaner solution reservoirs, and for clear access covers. "Costs for the raw materials used to make acrylics rose during 2003, which caused the pricing for acrylics to increase somewhat," reports Stephen Magaziner, business manager for Modified Acrylics. "Those factors affecting raw materials costs have settled, so price stability for acrylics and acrylic-based materials has returned. Acrylic availability has not been a problem and supply is not expected to be a concern for 2004 and for the foreseeable future."

For polyethylene, Bob Buesinger, sales manager at Chevron-Phillips Chemical Company, also reports good availability. "Business began picking up last August, and we are cautiously optimistic for 2004. Prices have been up around 25 to 30 percent since the low levels of January 2003, and we think they will continue to be stable through at least the first half of 2004. This is largely due to the relatively high cost of natural gas, which is used as a raw material for polyethylene," he explains.

"There has been some tightness in our Eastar and Durastar copolyesters," Courtland Jenkins, market development manager at Eastman Chemical Company (Kingsport, TN, U.S.), tells APPLIANCE. "We've seen high-capacity utilization, and have needed to be a little disciplined in the new business we go after. This will continue into 2004, as capacity utilization will be higher than last year. Despite this, pricing has been fairly flat. This is partly related to the continuing low pricing for polycarbonate, against which clear engineering resins such as ours compete."


Daily News


Dec 22, 2014: DOE's Building Technologies Office releases Roadmap for Emerging HVAC Technologies

Dec 19, 2014: Whirlpool Corp. provides guidance for 2015

Dec 19, 2014: Panasonic to showcase built-in appliances at LivingKitchen 2015

Dec 19, 2014: New residential construction in November 2014

Dec 19, 2014: 2014 U.S. steel production up 0.7% from 2013

More Daily News>>

RSS Feeds
Appliance Industry
Market Research


November 2014: Appliance Magazine Market Insight Annual Subscriptions
November 2014: U.S. Appliance Industry: Market Value, Life Expectancy & Replacement Picture 2014
October 2014: Portrait of the European Appliance Industry
September 2014: Appliance Industry Focus: HVAC

Contact Us | About Us | Subscriptions | Advertising | Home
UBM Canon © 2014  

Please visit these other UBM Canon sites

UBM Canon Corporate | Design News | Test & Measurement World | Packaging Digest | EDN | Qmed | Plastics Today | Powder Bulk Solids | Canon Trade Shows