U.S. prices for polyvinyl chloride, the plastic most widely used in construction, are set to rise by 5 cents per lb. in the first two months of 2014. This is a significant price increase in a market that will see producers end the year with a net five-cent increase in their 2013 margins, according to PetroChem Wire’s PVC & Pipe Report.
The 5-cent PVC increase announced for early next year is expected to be very difficult for converters, particularly pipe manufacturers, to pass along based on the tenuous state of the U.S. housing recovery, the PVC & Pipe Report noted. Producers have proposed a 3-cent-per-pound hike for January followed by a 2-cent-per-pound increase for February 2014.
These higher raw material costs could have a significant impact on prices for many consumer goods, most notably plumbing pipe. The pipe segment of the market is by far the largest consumer of PVC, but its many other end-uses include siding, gutters, window framing and everything from flooring to furniture to medical tubing.
Also supporting these rising prices are the stronger prices for ethylene used to make PVC as well as PVC export markets.