According to Plastics News, 2016 was a good year for the PVC market. In fact, PVC was doing much better than any other commodity resin in North America, with sales up more than 5 percent ¹. Domestic sales grew almost 5%, which also included 7% in exports. Although some volatility is expected, PVC makers are cautiously optimistic about 2017, based on the growth in 2016. PVC market growth looks incredibly strong this new year within North America, due to the housing market², especially in PVC siding, deck and fencing. PVC exports should continue at a healthy clip in 2017 and PVC demand from the housing market depends on whether higher mortgage interest rates are offset by increases in consumer and business demand related to government spending on infrastructure³. As long as the market continues to grow, PVC uses in general (and PVC pipe in particular) will continue to be strong in 2017.
Compared to the polyethylene market, PVC manufacturers are bringing on a new capability at a more measured rate and compared to the polypropylene market, they’re not facing “the constant threat of lower cost imports” ³. Because of this, PVC profit margins are “more defensible and sustainable” than the other major commodity resin markets.
¹ The American Chemistry Council in Washington
²Mark Kallman, a market analyst with Resin Technology Inc. in Fort Worth, TX
³Phil Karig, managing director of the Mathelin Bay LLC consulting firm in St. Louis, MO