Document RoJYaDXxg23VEQM5w47NYg0v

580.1881 E MARCH 1975 2 Outlook Loud term, demand lor PVC in its major markets is generally expected to remain stable since PVC plastics uses are firmly established, and because there is no competitive material that can -readily replace PVC. In some markets, fairly appreciable growth of PVC demand is seen. The following table summarizes demand projections for major PVC end-use markets. Outlook for Domestic PVC Resin Consumption--1980 Estimated Average Annual Growth Rate 1975-1980a (Percent)_____ Projected Annual PVC Resin Demand by 1980 (Millions oi Pounds) Construction Household Uses Consumer Goods Wire and Cable Packaging Transportation Miscellaneous Uses Total 16-17% 4-6 6-7 8-10 10 6 6-8 11-12% 4,246-4,428 772-848 712- 734 609-667 538 342 453-497 7,672-8,054 a. For these projections, a 1975 base equivalent to the 1973 consumption (4,520 million pounds) was assumed. Also assumed was a 3.5% per year average growth in gross national product in constant dollars. Source: CEH estimates. OLl 7293 ******* In construction, PVC's largest market, consumption for pipe, conduit and pipe fittings alone is expected to reach the 3,3 billion--pound-level by 1980 (average annual growth rates of 20-25% are foreseen). As oi early 1975, however, no quick resumption of growth of PVC rosin consumption is in sight, although a repeat of the 197-1 level and possibly even oi the 1973 level, can be expected for 1975 if the economy accelerates markedly in the second hall. Whether or not this can be achieved depends on the production capacity that will have to close down as a result oi the OSHA vinyl chloride monomer exposure standard. According to industry sources, a considerable number of older PVC mami lecturing plants cannot likely be modified to ensure compliance with this very stringent requirement. Early estimates of the total PVC rosin capacity that may have to be closed on that basis ranged from 1.5 to 3 billion pounds, i.e., 22 to 45% of total capacity, but more recent estimates of the capacity that may have to close down are lower. If one assumes that of the early 1975 capacity of about 6,565 million pounds per year 15% cannot meet the oyilA standard, a CHEMICAL ECONOMICS HANDBOOK srANrOHO hisrarch MM I * Nt 0 I'AHt , CM, II0KNIA f capacity of 5,580 million pounds would still he operative, and would probably be able t< produce approximately '1,800 million pounds of PVC rosins in 1975, which would match the 197-1 figure. It is possible, however, that more than 15% of the capacity may have to close down. Demand for PVC resin's, which is very low as of early 1975, is widely expected to strengthen in the second half of 1975, so that domestic consumption may reach the 1973 level of 4.5 to A.0 billion pounds. Some sources, however, foresee a lower level for 1 In 1976 and 1977, the limited production capacity will definitely hold down consumption as demand really picks up. However, vinyl chloride monomer supply is also expected to be tight in that period. The .year 1978 can be expected to bring relief with both newly constructed resin capacity coming on stream and also monomer supply increasing. OLI 7294