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Recently released consumption figure of plastics
raw material for 2003 in North America indicate flat plastics growth.
The total production and sales of all resins remained static at
48.5 million tons, reflecting zero growth of plastics consumption
as well as exports in North America. The U.S. economy got off to
a slow and shaky start in 2003 amidst high oil and natural gas prices,
uncertainty concerning the Iraq war and continued loss of jobs.
Economic growth was dampened in the first half of the year. However,
a rebound of capital spending resulted in recovery in the summer
and accelerated growth in the second half of 2003. Aided by massive
fiscal and monetary stimuli, economic growth was 3.1% for 2003 as
a whole, accelerating from the 2.2% in 2002 and the 0.5% growth
experienced in 2001.
A recovering economy provided opportunities for renewed growth in
the U.S. plastics market in the later half of 2003 but still could
not wipe out the loss of the first half completely. Only PP managed
to show some modest growth. PE sales were down despite economic
recovery in the later half of 2003.
American Plastic Council (APC) estimates that PE consumption in
North America was down by 1 % against 2002. The export of PE was
significantly down by about 11% due to high prices triggered by
rising feedstock prices. Among the polyethylenes, LDPE suffered
the most, recording a negative growth of 2.5 %. LDPE lost significantly
in the film sector. LLDPE also lost by 1.7 % in domestic consumption.
The film market that consumes more than 65% of LLDPE was completely
flat. HDPE, thanks to growth of blow moulding sector, showed a modest
0.6% positive growth over 2002 consumption.
Polypropylene consumption grew by 1.6% over 2002. PP is the only
commodity plastics that had a positive growth. The injection moulding
sector showed about 2 % growth but other sectors could not sustain
the growth.
Polystyrene, after resounding recovery in 2002, went down again.
Crystal PS sales declined 2.1%, High Impact PS sales were down 5.1%
and Expandable PS sales fell 4.9% from the previous year. In terms
of market segment growth, bright spots for PS resin were few and
far between (e.g., food service up 2.1 % and major appliances up
0.5 %). All other markets saw declines with media enclosures taking
the highest fall (down 14.8%).
Polyvinyl chloride (PVC) consumption also showed a decline of 2.1%
over 2002. PVC pipe, one of the largest markets, remained flat with
marginal improvement over last year. Some of the other core markets
such as PVC siding, flooring, paste processes, films and sheets,
coatings and molding applications had lackluster growth that brought
total demand down in 2003.
The economy experienced a period of high growth in the second half
of 2003, when economic growth averaged over 6%. The recovery in
the world economy in general and the industry in particular, has
taken hold and accelerated. Globally, USA will be the locomotive
of economic growth, followed by Asia. West Europe will lag. But
in general, the strengthening economy could promise a the year 2004
with bright prospects for plastics.
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