Plastics, resins & HDPE report: September 2017
PVC resin supply has been disrupted by Hurricane Harvey. Details about how it will affect prices long-term remains to be seen. What we do know is the areas of Houston affected have high concentrations of refineries and processing plants that all contribute to the production of PVC. Many factories contributing to this industry in the Houston area have either shut down or significantly reduced their production. The current result has been increased prices and decreased availability with many manufacturers rationing supply. So far, the hurricane season has been a major disruption to the price of oil, which tends to affect PVC pricing as well. It remains unknown for how long this will continue, but with panic in the market, price volatility and decreased supply, at least the short-term, is likely.
The HDPE market that has struggled all year to keep up with production has been dealt another blow in the wake of hurricane Harvey. Most HDPE pipe-grade resin is manufactured in the Houston area, as well as the plants that produce the feed stock, which is ethylene.
As of early September, there were still no definitive dates as to when resin production will come back on line, prompting all HDPE piping manufacturers to declare Force Majeure. What we do know is supplies have been curtailed and many orders for resin were canceled, or in some cases orders were stopped during transit to the end user. Prices that were already on the rise have expectedly jumped even higher, and no one is sure exactly where they will land. Most but not all HDPE pipe suppliers have suspended the quoting of pipe simply because they are out of resin and they simply don’t know what to price or how long it will take to get their supply. So at this point, lead times for manufacturers that had resin in stock prior to Harvey went from six to eight weeks to now more than 14 weeks.
The American Supply Association and its Industrial Piping Division is the national organization serving wholesaler-distributors and their suppliers in the industrial and mechanical pipe-valve-fitting industry. As a powerful alliance of channel partners, we provide a forum for your upstream trading partners to exchange critical information and address key issues.
In particular, ASA’s IPD members constantly check the pulse of the materials and commodities they proudly supply to you. ASA’s IPD members are knowledgeable industry leaders, and those who volunteer their service on the IPD Executive Council compile and prepare the IPD Commodity Reports. The reports contain some of the most current and qualified market data and information available from the industry’s leading manufacturers and distributors about emerging trends and other price-influencing actions and events.
This information is an example of how ASA’s IPD manufacturer and distributor members are constantly looking ahead to ensure you have information and resources you need to be successful. Learn more at www.AdvanceYourAbility.com.