APLA '17: US PVC demand to grow on hurricane recovery and rebuild

12 November 2017 19:33 Source:ICIS News

RIO DE JANEIRO, Brazil  (ICIS)--Demand for US polyvinyl chloride (PVC) resin will continue to show strength in 2018 and beyond as increased construction activity to repair and rebuild from Hurricanes Harvey, Irma and Maria will drive sales, an industry consultant said on Sunday.

“I think the hurricanes' damage will increase demand in 2018 and through 2019,” said Bob Bauman, with Polymer Consulting Plastics, on the sidelines of the Latin American Petrochemical Association (APLA) meeting.

The hurricanes wrought havoc in Texas, Florida and Puerto Rico and it will likely take at least two years to contend with the aftermath, Bauman said.

The reconstruction efforts will require PVC resins for pipe, wiring insulation and other building products, including siding, decking and other materials, he said.

Demand growth will likely put upward pressure on prices during the period, Bauman added, because no new PVC production is expected in the coming two years.

Shintech has filed an application for a permit to expand its chlor-alkali and vinyls production in Plaquemine, Louisiana, by an estimated 350,000 tonne/year. But even the most optimistic estimates are that the new production would not be online before late 2019.

US and Canada PVC demand has shown respectable growth during 2017 as home construction activity continued to recover from the 2008 mortgage meltdown and subsequent credit crunch.

PVC prices have recently softened in global markets as chlor-alkali producers have run hard to capitalise on high prices for caustic soda, a co-product of chlorine production.

Major US PVC producers include Shintech, Formosa Plastics, Occidental Chemical and Westlake Chemical.

The annual APLA conference has registered 850 delegates and runs through Tuesday.

By Bill Bowen