Document YG8ZVo4oLaqgJX2XYXZ91kygn

F MAR 2 1973 Petrochemical guide--20 *: ? JfS uture Here is how manufacturing methods, markets, buyers and setters and economics affect the future of viny/ cliioiide David P. Keane, Robert B. Stobough nnd Phillip L. Townsend, Harvard University Graduate School of Busi ness Administration, Boston, Mass. PER L'TTl Vjnyi, CHLORiuF. has a angle important end use as monomer in production of p ilyvinyl chloride (PVC) *nd vinyl copolymers. The U.S. production of vinyl ehlo ide expanded at an annual rat r Bfl.Tl percent during the 1960s, reaching a level of 4 liulliorT pounSs In l970and 1971. This increase has been accompanied by a steady fall in average F.O.B. selling price from 10 ccnts/pound to about 4.5 cents per pound in 1970 and 1971. As a result, the imputed value of production has expanded for the decade at a 6 percent rate to $180 million in 1970. Polyvinyl chloride and other vinyl copolymers are being substituted for older materials on several fronts. Through replacement of steel and iron in piping, wood in construc tion and packaging, glass and paper in packaging, and leather in clothing, polyvinyl chloride consumption will continue to expand at a rate of about 10 percent through 1975 and beyond. We expect 1975 to sec U.S. production of 5.6 billion pounds of vinyl chloride (VCM). This monomer will be sold at an average price of 4.5 ccnts/pound, and production will therefore be valued at about $280 million (1971 dollars). Production of PVC in Europe is even larger, with 1970 production approxi mating 5.3 billion pounds. European growth rates have also been somewhat higher, with one enthusiastic source predicting a 1975 PVC production of 9.5 billion pounds.1 In all likelihood, European PVC consumption will gro*r less rapidly than in the United States because of the higher per capita consumption prevalent In sonic major markets in Europe, which makes growth more difficult. Manufacturing processes for VCM have changed rapidly since 1965. Several new ethylene oxychlorination processes have been employed to shut down older aectylenc-bascd production. These large, new processes now account for over 80 percent of U.S. capacity, and the same process should continue to be employed in expan sions through 1975. Recent announcement of an ethanebased process (TRAXSCAT) has raised the yet-unproved possibility of bypassing ethylene cracking entirely, but even a viable TRAXSCAT cannot greatly influence the pre-1975 VCM business. This process switch has also resulted in large changes in the cast of players. In general, some users of VCM have ceased to produce their own monomer, with pro duction undertaken by large, integrated producers of ethylene and chlorine. Dow and lk F. Goodrich air the largest producers and have produced VCM for quite a few years. However, PPG, Shell and Conoco have become the third, fourth and fifth largest VCM producers despite not having been in the business in 1965. We c.\|XTt this trend toward concentration of large VCM plants among feedstock producers to continue through the next several plants. The PVC business has also grown at a rapid rate else where in the world. Became of difficulty and expense of shipping, export of VCM lias usually constituted a limited VINYL CHLORIDE market for U.S. producers, with exports during the 1960s accounting for only a few percent of U.S. production. In 1970 and 1971, however a lack of adequate European capacity caused U.S. VCM exports to increase to some 15 percent of domestic VCM production. This proportion will probably return to less than 6 percent by 1975. MANUFACTURE Most present-day vinyl chloride monomer (VCM) capacity relies on the so-called balanced oxychlorination process to convert chlorine and ethylene to VCM. There are, nonetheless, several older process routes which are discussed below in the approximate order of their com mercialization. 1. Catalytic addition of hydrochloric acid to acetylene HC - CH + HC1 Artiva'gd carbon , ^ _ CHCj t rigC-ls Acetylene Hydrochloric acid VCM The earliest plants of this sort employed carbidederived acetylene and hydrochloric acid derived by com busting hydrogen with chlorine. The catalyst for this addition is mercuric chloride absorbed on a carrier such as activated carbon. The reaction is simple and of high yield when compared to subsequent VCM processes, thereby allowing simple product purification, no sizable waste disposal problem, and low capital and operating costs. Carbide acetylene and purposely produced hydro chloric acid were gradually replaced with less expensive petroleum-derived acetylene and byproduct hydrochloric acid (which also coincided with major relocations to the U.S. Gulf Coast), but raw material costs remained high relative to newer processes. Some VCM is still produced with this process, but these surviving ptants are very' tightly integrated with other acetylene-related units and have been gradually disappearing. 2. Balanced ethylenc/acctylcne VCM production CH* - CH. + Cl* -------------- -* CH, a - CHiCl Ethylene Chlorine Ethylene dichloride (EDC) CH, a - CH, Cl 900-950CH, = CH Cl + H Cl EDC VCM Hydrochloric acid HC CH + H Cl----------------* CH, - CHQ Acetylene Hydrochloric acid VCM There arc instances where the first two steps of this process--chlorination of ethylene to EDC and cracking of EDC to yield VCM plus hydrochloric acid--have been applied without an acetylene unit. Ethyl Corp. has applied this technique, with byproduct HC] used to pro duce ethyl Chloride for manufacture of tetraethyl lead antiknock compounds. Most producers, however, cannot justify sufficient end uses of the HC1 byproduct The result was the balanced cthylcnc/acetylcne complex (as employed by Union Carbide and Monsanto at Texas City, Texas). Plants were sized so that die acetylenebased production consumed most excess hydrochloric acid fom EDC cracking to produce VCM directly.*This process reduces by half the dependence upon acetylene as a feedstock, but no new examples have been structed in the United States in the past few yean. 3. Balanced oxychlorination process Direct chlorination CH, = CH, + a,--------------- CH,C1 - CH*a Ethylene Chlorine EDC URL 19416 Oxychlorination CH, - CH, + HC1 + JO, CH,Q - CH.C3 + H.O Ethylene EDC Water Cracking CH,C1--CH,Cf -90 0---950F--CH, - CHQ + HC1 EDC VCM The difference between these processes and the earlier uses of EDC cracking is the second reaction above to (1) prevent exporting a large 1IC1 byproduct and (2) eliminate the need for acetylene-feedstock. This reaction ts essentially a variant of the Deacon process to convert HCl to more valuable chlorine. . j I ` 2HQ + 10,------------ 0. + H& While the Deacon process has not been a commercial success because of technical problems with corrosion and product purification expense, oxychlorination has over* come these problems by immediately capturing the chlorine tn situ to form EDC. The combined EDC streams are then cracked and the resultant HCl recycled to close the loop. As mentioned above, most presently employed processes--including Goodrich, Dow, Stauffer and PPG-- use some variation of balanced oxyehlorinaiio*. I j j l * Fig. 1--Vinyl ehlorldo monomer process via olhano as oflored by Lummus/Armstrong. OKI Reactor OHCL pmuawr recover* QHCL secokqabt recover* PtRECT CHLORlKATlON REACTOR COC PURlf ICATION CBACHINS EURNACC MO COLllMW VO CQCUMM Fig. 6*2--Vinyl chloride by oxychlorination by 8.F. Goodrich. 4. Single-step chlorination and .-cracking of ethane (TRANSCAT process) future, should the process prove to be commercially viable. CH,--CH, molten salt Ethane CHi ~ CH, Ethylene ch, - ch, + a,---------------- ch, a--ch, a Ethylene Chlorine EDC ch* a--ch2 ci nio!tsn_ ch*--chci + hci salt EDC VCM Hydrochloric acid 2Ha + } O, ni--t-C-n-&a!t^ cu + HjO The recently announced TRANSCAT process involves the development to a pilot stage of an ethane-based route which foregoes the separate pxirification of ethylene (see Fig. 6-1). Ethane, chlorine, air and excess hydrochloric acid (if desired) arc fed to a molten salt bath with an extremely short residence time and a high temperature, where all of the above reactions apparently occur simul taneously. The potential licensors (Lummus/Armstrong Cork) claim above 95 percent VCM yield on chlorine and 80 percent VCM yield on ethane fed. Even more chemically revolutionary is the claim that chlorinated wastes which are produced may be partially recycled to the reactor to result in additional VCM, The indicated economic advantage (see "Economics") or ethane as a feedstock might make this the VCM process of the Popular VCM processes. While oxychlorination Isas&aea the process route chosen for all recent VCM plants in the United States and most of the rest of the world, this has not decreased the competition among different processes and licensors. There are several competing processes which have demonstrated their commercial feasibility. The fol lowing three oxychlorination processes--on which signifi cant information has been published--are representative of most manufacturing facilities. 1. B. F. Goodrich oxychlorination (Badger). This process was the first successful oxychlorination process (1965), with the initial -iOO-miHion-pound/ycar unit in stalled at Goodrich's plant in Calvert City, Ky. There are about 8 plants which utilize this process, having an aggregate capacity of about 4 billion pounds/ycar.* As is true of all balanced oxychlorination processes, the over-all material balance involves feeding ethylene and chlorine and production of vinyl chloride (see Fig. 6-2). Yields arc certainly in the 90 percent range (and may exceed 95 percent) on both primary feedstocks. The .yield losses involve production of light and heavy ends which boil above and below EDC. These byproducts consist primarily of C* and C- chlorinated organics, some of which arc suitable as feedstocks for production of chlorinated solvents (carbon tetrachloride, perchlorocihylcnc), while the balance requite disposal. The first of three segments of the process is direct VINYL CHLORIDE addition of chlorine to ethylene to produce ethylene dichloride (EDG). This reaction is essentially stoichio metric in both reactants, with chlorine usually maintained in a slight excess. The reaction is liquid phase with a dissolved catalyst and mildly "exothermic. Reactor tem perature and pressure are controlled by cooling water heat removal. Following the reactor, the EDC product is fed to a two-step purification train to remove light and heavy ends (the same train processes two other EDC streams). The second major operation consists of cracking EDC to produce vinyl chloride and anhydrous hydrochloric acid. The cracking occurs at 900-1,000 F in a directfired furnace which is packed with a catalyst (pumice has been a traditional choice). Conversion of EDC is typically in the 50-60 percent range to optimize the costs between coking cycle, utilities cost and yield. The hot product gases arc quenched by direct contact with a condensed recycle stream of the same composition, prior to fractionation. In the HC1 column, anhydrous HCl is removed overhead for use in the oxychlorination unit. The VCM column produces VCM as an overhead prod uct meeting finished product specifications, and produces a recycle EDC stream of unconverted EDC. This stream is purified in the common EDC columns prior to recycl ing to the cracking furnaces. The purification step is required to prevent fouling of reaction surfaces in the cracking furnace. These two previous process sections offer relatively little advantage over older processes--they constitute an unbalanced EDC cracking operation (such as practiced by Ethyl) which produces I-ICl as a byproduct. The third section of the B.F. Goodrich and other oxychlorination processes im-o&vc* conversion of this excess HCl 10 EDC. Air, ethylene and IfCl arc charged to a fluidized catalyst bed at a moderately high temperature and somewhat elevated pressure. The reaction to produce EDC (given above) yields water byproduct, which is rejected as the product vapor is condensed. The first step of condensa tion produces a crude EDC product, while die gases (primarily diluent nitrogen) must be fed to a secondary absorber to recover a second stream of EDC by absorp tion/stripping. The tail gases are vented, while crude EDC is fed to the common EDC finishing train. The oxidation of HCl to Cl3 is highly exothermic and the subsequent addition of CI to ethylene is mildly exo thermic. As a result, the oxychlorination reactor, is cooled by generating steam, which brings die whole process closer to self-sufficiency on steam supply. The net effect of this crucial section is thus the con version of HCl, ethylene and air to a VCM precursor. tVhile the process is depicted as balanced, design and operating changes allow any individual plant to produce or accept cither HCl or EDC as local conditions warrant. 2. Toyo Soda oxychlorination {see Fig. 6-3). A pro cess very similar to that of B. F. Goodrich has been employed in several Japanese plants. The essendal de sign differences appear to be: (1) the use of a fixed bed reactor for oxychlorination, as opposed to the B. F. Good rich fluid bed; (2) use of a hot oil reactor coolant and external steam generation, and (3) incorporation of a specific EDC dehydrator column not shown in the B. F. Goodrich publications. None of these differences are CNlOftlNATOR rrsorber STRlPPCB HCAVIES C0LUUM CRACKER CUEKCHC* HO COUINIf URL 19418 Fig. 6-3--Toyo Soda's oxychlorination vinyl chloride process. 102 Fj.y.r,,,.,, um T major; the processes should be roughly competitive based upon published data.* 3. Stauffer Chemical oxychlorination. This Is again very similar to the earlier oxychlorination processes. Minor changes in the routing of streams, small differences in catalyst performance, and features of the mechanical design are all that differentiate between the published information for this process and the previous two. It is noteworthy that Stauffer published an estimate of 3.7 billion pounds/year of vinyl chloride capacity in 17 plants utilizing this process.4 4. Monsanto oxychlorination. There are several licen sees for this similar process.* 5. Dow oxychlorination. Only Dow and foreign sub sidiaries have used the Dow VCM process, and no indi cation of a willingness by Dow to license to others has been published. ,6. Union Carbide (Lummus) balanced acetylene/ ethylene process. No recent examples of this process have been constructed.in the United States, but a Union Car bide venture using a Wulff process acctylcne/cthylcne plant in Brazil is employing this process to consume part of the production. Complete startup of this plant is planned for 1972. The basic flow scheme is shown in Fig. 6-4. Ethylene and chlorine produce EDC, which is cracked to yield HC1 and VCM; the process is very similar in this area to the above processes. However, instead of using oxygen and ethylene to convert the byproduct HC! to EDC, the balanced process then involves the older acetylene route. The reaction is a vapor phase reaction over HgCJ./carbon catalyst with a slight HC1 excess. A circulating coolant removes reaction heat to control the reaction temperature to about 400 F. Conversion is less than complete in some plants, requiring recycle of acetylene and HC1, but the reaction yields are 95 percent or greater. Therefore, the removal of light and heavy byproducts is simple. This results in low capital and operating costs for the process, but the use of acetylene at current or projected U.S. prices makes this process less than competitive with balanced oxychlorination (sec "Economics"). 7. Others. Pcchincy-Saint-Gobain offers combined production of chlorinated solvents and vinyl chloride in flexible proportions. A single plant at Saint Auban, France, has operated since the spring of 1970 to produce about 120.000 metric tons/year of VCM with this pro cess.* Diamond Shamrock/deNora offer "Dianor," a process to produce and crack EDC which is aimed at developing countries with no ethylene complexes.' The process op erates on ethylene as low as 60 percent concentration and produces HC1 byproduct, which would leave the process uncompetitive under any but the special circum stances of small, developing chemical markets with tariff protection. Feedstock availability. The importance of feedstock cost to VCM producers lias resulted in the entry to the VCM market of large, integrated chlorine an'1 ''Xylene producers (see "Individual Companies" and "Econom ics"). Future manufacturing efforts will be largely influ- Fig. 6*4--Author's Interpretation of the balanced VCM process as announced by Unton Carbide (LumtnusJ. TABLE 6-t--Properties of VCif Mol. ............................................................ Specific gravity.................... Kiel (in* point.............. .. Boiling point...................................... Flath point........................................... .. Maximum aUouable concentration (ppm by volume)............................... Explosive limit* % by volume la air 62J0 0.9334 --15n3a.8t**Cc -108* F 500 Lower 4 Upixr 22 20*/20 *C (<-72.144*f4>*1-) enccd by trends In both of these related fields. A brief review of trends follows: Ethylene production in the United States has been drifting away from the traditional patterns. Until recently more than 80 percent has been manufactured from ethane and propane cracking and about the same proportion located in the U.S. Gulf Coast.* Some recent plants have involved movement toward the north and Puerto Rico and cracking of heavy feedstocks. With developing short ages of natural gas, a continuing erosion of the competi tive advantage of cracking Gulf Coast ethane and propane is likely, and cracking of heavier feedstocks will probably result in higher ethylene prices. 'With ethylene much more difficult to ship large distances than either vinyl chloride or chlorine, a tendency to locate vinyl chloride production near ethylene plants should continue. Chlorine is the other major feedstock, with VCM accounting for about 15 percent of U.S. chlorine produc tion in recent years. Largely as a result of slumping VCM demand (which declined slightly in the first half of 1971), chlorine demand has been slack in the 1969-1971 period. However, as various chlorinated products resume their growth trends between 1971 and 1975, chlorine demand should once again require expanded capacity. Given the considerable economics of scale in chlorinc/caustic pro duction, the largest and most integrated producers will retain their competitive advantage in VCM. Very' substantial electrical energy requirements for chlorine production will force locations to sources of lowcost power. While nuclear fuel and coal are in the running as long-term suppliers of low cost power, petroleum and natural gas remain necessary until at least 1980. There fore, availability of petroleum and natural gas fuels will hetp determine chlorine plant locations until at least 1975. URL 19420 VINYL CHLORIDE These trends indicate that manufacturing locations for VCM arc likely to be heavily influenced by availability of inexpensive hydrocarbon feedstocks and fuels, with relative labor and construction costs, water and transpor tation facilities acting as less important constraints. Physical properties. See Table 6-1. MARKETS U.S. consumption of VCM was about 3.3 billion pounds in 1970, with 664 million pounds being exported. Con- f965 1970 1975 Fig. 6-5--Per capita consumption of polyvinyl chloride." APPAREL CONSTRUCTION 9 5 FLOORING 17 HOME FURNISHINGS PACKAGING PIPE ft FITTINGS REC0R0S TRANSPORTATION 4 5 9 WIRE 11 CABLE Q 6 6 .. 12 __ 1 15 8 12 7 13 5 tO 9 It M 3 6 10 ALL OTHER 18 1965 rr 1970 20 - ~" 1975 Fig. 6-fr--End use markets for PVC." sumption of VCM s almost rntircly for production of polyvinyl chloride resins and rojxdymer resins (propylene, ethylene and vinyl acetate are commonly copolymerizcd with VCS*!)- Domestic consumption js projected to grow about 10 percent annually from the 1970 level of 3.3 billion pounds to 53 billion pounds in 1975. Export markets will decline from the 26 percent of U.S. produc tion experienced in 1970 to the more usual level of 5-6 percent of production, or 300 million pounds, by 1975. End uses of PVC are characterized by more variety than most ertfoex commodity resins. Physical properties of PVC vary from the soft and flexible plasticized varieties used in dolls to the strong and rigid PVC pipe invading the construction markets. Fig. 6-5 demonstrates the rapid growth in per capita consumption which has resulted from this variety of properties.** As a result, PVC con sumption is also less vulnerable to the loss of any single end use market The more rapidly growing markets for PVC are con struction products, packaging, pipe and fittings. These areas should exceed the 10 percent growth rate of the overall PVC market. Segments which are more mature and will grow at less than 10 percent include apparel, flooring, home furnishings, phonograph records, trans portation equipment, and wire and cable coatings. An estimate of the 1965, 1970 and 1973 market sliare of each category is given in Fig. fi-6. While some categories will have declined relative to all PVC consumption, ac tual volume sold in 1975 is projected to increase in all categories.** Construction uses for PVC include vinyl-coated wall coverings, and strips of PVC sheet to serve as water stops in walls and weatherstripping. The largest potential, how ever, probably belongs to PVC siding and window frames, which are rapidly growing competitors of older wooden and aluminum products. The construction market should grow in excess of 20 percent annually for the next five years. The- packaging application of PVC has been growing very rapidly in recent years. There are environmental pressures to restrict PVC content of packaging because of HC1 released when packaging is incinerated, but such restrictions will act to slow this growth area before 1975, not to reverse the trend. Packaging consumption of PVC grew at above 25 percent annually in the last five years, and should grow at 15-20 percent for the next five years. After 1975, however, look foT growth to slow considerably as effective control of HC1 emissions causes other materials to replace PVC in some applications. Use of PVC pipe and fittings has benefitted from the accelerating change of U.S. building codes to allow plastic drain, waste and vent piping. A.D. Little has projected a 1975 consumption of 1 billion pounds of plastic piping, with PVC representing a large share.11 The PVC in this application Is often blended with chlorinated poly-ethylene resin. Competition with acrylonilrile-butadicne-styrene (A13S) resins and styrene-acrylonitrile (SAN) resins will be important in determining the actual growth of this PVC application, but 15 percent is a likely growth rate if PVC prices remain below those of ABS and SAN resins. Among the more mature PVC markets, use of PVC in transportation equipment should continue at a rela tively high growth rate. Further penetration of the auto mobile market is not a major hope for PVC, since scat TT-V1071 1TvnnnrnnN PROCESSING TABLE 6-2~Prs{i*tlij mtlhodi for PVC" Erl nation fwire. film, sheet and general extrusion)........... Calendering (film, sheet and eoating)....................... Molding (blow, injection, rote, compression)............. Coating (dip. knife, roll, spray, lamina lion).......... .... Other......................................................................................... Slur or market, % 40 $5 SO JO 0 URL 19421 fig. $-7--PVC production by type according to the U.S. Tariff Commission. covers, headliners and dashboards have all been heavily jrvnetralcd. As a result, this end use will grow at about the rate automobile production grows. While other trans portation uses will increase, look for tins segment to grow at 8-9 percent over-all. Uses of PVC in apparel, flooring, home furnishings and wire coating are mature segments. Growth of these seg ments should keep pace with real GNP growth at about 5 percent annually through 1975. Another possible categorization of PVC uses is by the processing methods being used to meet the above markets. Table-6-2 presents a breakdown by processing methods, again reflecting the diversity of PVC markets. Polymer producers. One reason for the varied properties of PVC resin is the diversity of polymerization methods employed and another is the large number of PVC pro ducers, each with a slightly different product line. While 65 percent of VCM was polymerized captively in 1960, this percentage declined rapidly as older acctylcne-bascd plants were replaced with larger ethylene-based plants. Today companies such as Dow and Shell are exclusively merchant sellers of VCM, while PVC producers such as Monsanto and Union Carbide have discontinued VCM manufacture. As a result, only about 40 percent of VCM was captively consumed in 1970, and the percentage will probably be closer to 30 percent in 1975. The 21 com panies currently producing PVC arc listed in Table 6-3, together with capacity by region. Of these 21 companies, 7 also produce VCM (see Table 6-5). A final characterization of PVC production is the type of polymerization employed. Suspension homopolvmer resins have been an increasing fraction of PVC production in recent years, mostly at the expense of copolymer resins, while dispersion resins have maintained a relatively con stant share. Fig. 6-7 presents a breakdown of PVC by method of polymerization. World markets. During the 1960s, exports of VCM averaged less than 5 percent of domestic production. VCM must be shipped and stored either under pressure or in a refrigerated tank. The relative difficulty of shipping, low selling price in relation to freight cost, and ready avail ability of VCM technology has created a strong tendency to produce VCM locally rather than import for an ex tended period. In 1969, 1970 and 1971, however, rapid expansion of European VCM demand and lagging pro duction capacity led to abnormally large imports from the U.S. Exports accounted for a high of 16 percent of domestic VCM production in 1970. As added capacity TABLE 0-3 PVC prodvtera In the United Stole*,* Jan. 1, 1971 Northeast Diamond. Leominister, Mata. Delaware City. Del. Poustown, Pa. Goodyear Tire & Crest American Pantasote................. Pedricktcwo. N. J. Niatara Falls, N. Y. Fitchburg. Mas*. Burlington, N. J. Springfield. XlatB AtlOnct. Mass. Southeast Burlington. X. J. FWaOiOKSOO. K. J. Continental Oil ... Firestone.................. Perryville. Md. Fantarote................. Union Carbide.. .. S. Charleston, W. Va. Midwest Allied Chemical..., B. F. Goodrich Calvert City. Ky. Painerville. Ohio Illiopnlit, III. Ashtabula, Ohio Henry. Itl. Avon Lake. Ohio Uniroyat............. Southwest Diamond* Louisville. Kv. Painetville, Ohio Ethyl......................... Goodyear Tire k Deer Park, Texaa Baton Knuce. La. PlaQuemine, La. Union Carbide.... Texas City, Texas Far West American B. F. Goodrich Long Beach, CaBf. Lone Beach. Calif. Keysor...................... Saugus. Calif ]2 companies 19 plants 1.300 MM lbs. capacity 5 companies ISO MM lbs. capacity 4 companies 6 Plants 1X00 MM lb^ capacity - 4 companies 4 planta 600 MM lbs. capacity 3 companies 3 pUnti 21 total companies 33 total plants J.S50 MM lbs. total rapaclt? TABIC 0-4--Western European PVC consumption (thousands el metric tons) Year........................................ 1972......................................... 1903......................................... 1904......................................... 1903..................... .................... 1960......................................... 1967......................................... 1968......................................... 1909......................................... 1970*..................... ................. Growth rale (1962-1970)....................... 1975 Consumption*...... Projected growth Rate (to 1073)*............... EEC son 610 709 643 950 1,001 1.227 1.503 1,508 15% 2.373 10% EFTA 227 235 30$ 339 339 401 472 323 337 12% 820 8% Spain 17 26 29 33 46 59 71 91 97 24% 220 18% Other 40 52 72 36 35 141 133 HO 148 16% 233 14% Total. Western Europe 793 943 1.178 1J71 t.n 1.661 1.923 3-261 2.400 13% 2.900* 10% Source: European Chemical News and Oil, Faint and Drug Reporter, OtL SO. 1970, plus authors' estimate*.* comes onstream in Western Europe and developing coun tries rush to build VCM plants, U.S. exports of VCM will decrease again to 5-G percent of production or lower. U.S. exports of PVC resin are also minimal; in 19G9 and 1970, about 5.5 percent and 6 percent of the U.S. PVC sold was exported. Two reasons for this arc the  VINYL CHLORIDE TABLE 6-5--U.S. produton of VCM rapidly expanding domestic markeLs /or PVO and the high relative /fright costs. Furthermore, tarlfT barriers are high--20 percent or more--between European coun tries, as well as between Europe and the United States.1* Despite this, the specific properties required by resin users remain the most dilTicult barrier to a large world trade In PVC. In a recent report of the Standard Research Institute11 projections of the world output of PVC for 1970 and 1980 arc compared. The percentages accounted for by each producing area are as follows: North America Western Europe Japan Others 1970 26.5% 41.3 16.5 15.7 1980 26.5% 39.7 17.9 15.9 100.0% 100.0% While special purpose resins sales to developing markets will continue to be an attractive market, PVC resin ex ports will remain a small market at 5 percent or less of production. The European PVC market is considerably larger than the U.S. market (sec Table 6-4), based upon Europe's large population and greater per capita consumption. This will allow European producers to build large, com petitive VCM facilities to serve their own markets. As U.S. producers encounter higher ethylene costs based upon cracking heavier feedstocks and higher chlorine costs from more expensive electric power, exporting to the European VCM market should cease to be attractive to U.S. produce^.14 Japanese PVC producers also represent a sizable market for VCM, but domestic Japanese production is ample to provide the estimated 2.4 billion pounds which will be required in 1972. Estimated VCM capacity is in the neighborhood of 3 to 3.3 billion pounds/year (see Table 6-6), indicating either sizable exports or low operating rates for Japanese VCM producers. A partial listing of foreign VCM producers is given in Table 6-6. Since this is not an exhaustive listing, total capacity figures are not available. However, the per capita consumption of VCM is even higher In Europe than in the United States and trends toward oxychlorlnatlon arc evident. INDIVIDUAL COMPANIES Table 6-5 lists U.S. producers of VCM as of 1972. Of the total capacity shown, 10 percent is based on acetylene and 8 percent on ethylene without oxychlorination capability. These plants must be considered vulner able to continued construction of large oxychlorination facilities. The remaining 5 billion pounds (82 percent) consists of modem, apparently competitive oxychlorina tion plants. Also noteworthy is the concentration of over 70 percent of VCM capacity on the U.S. Gulf Coast. With the exception of PPG's Puerto Rican plant, all recent capacity additions have been in Texas and Louis iana. The expansion of VCM capacity from 2.4 billion pounds/ycar in 1965 to about 6 billion pounds/year by 1971 was at an annual rate of 18 percent. The actual rate of new capacity construction has been, even more Producer Location Allied.................... American Chemical......... (AKCO'Siauffer) Monochem.. ... (iloiden* Unlroyal) Conoco................. Ujlon Rouge. La. Watson. Cali/. Geitraar. Ll . Laic Chuln, L*. Dow.................... .. PbQucmioe. La. Freeport Texas Oyster Creek. Texas Ethyl.................... Baton Rouse. La. Houston Goodrich.............. Calvert City. Kr- PPG...................... Lake Charles. Ln. Puerto Rico Shell...................... Houston Kereo. La. Tennteo......,. Houston 1972 Toiil Namrplato rapacity (MM lb./ye.) 300 170 300 Pr oceas OsycHloiination Stauffer Acetylene 600 940 180 700 270 150 1.000 300 500 00 SOO (1974) 255 5,865 Stauffer oxycMor(nation Dow oxycMor inailoa Dow oxychlorination Dow oxvehtorination Etliylcne/EDC ecaekine Ethjlene/EDC cracking Coodtleh oxychlorination (multiple train) Oaychlorinatlttn Oi vchlorinatton Stauffer ychlorination Stauffer oxychlorioatma Acetylene Source: Many published estimate* as interpreted by the authors. Note that effective capacity probably doer not equal nameplate capacity. A reasonable capacity figure would probably be of the above ratn. OS. aad Drut Rtfcrltr, Oct. 11. 1971, has the moH complete listias- rapid, with fully half of the 1965 capacity bring shut down in the same period. Eighty percent of 1971 capacity is less than 6 years old. Among individual companies, Dow has about 19 per cent of VCM capacity, and about 23 percent of oxychlorination capacity. Dow's position as a capacity leader among ethylene, chlorine and chlorinated solvents produccrs leaves no doubt ot Dow's long-term position as a VCM producer. Raw materials costs are crucial to VCM economics, bring roughly equally split between chlorine and ethylene (see "Ecoewsatks"). In addition, byproduct chlorinated hydrocarbons from oxychlorination are rou tinely absorbed into Dow's production of perchloroethylene and carbon tetrachloride. At the present time, this VCM is largely sold in the merchant market. While Dow has extensive experience in production of bulk poly mers, Dow has chosen to remain a merchant supplier and has discontinued production of PVC. The second largest VCM capacity belongs tO'B. -F. Goodrich at Calvert City, Ky. Two or three trains.art^M site employ Goodrich's oxychlorination process (see "Man ufacture"), and are notable in bring the only sizeable plants located in the northern or eastern United States. Goodrich has captive use for most or all of this VCM, but has made no recent move to expand beyond their existing 17 percent capacity share. Both ethylene and chlorine for this plant are produced by Goodrich at Cal vert City. PPG lias moved into second place with a 14 percent capacity share. Plants in Lake Charles, La., and Puerto Rico benefit from large internal chlorine sources and chlorinated solvents business to absorb byproducts, but ethylene is purchased in both cases. As is cite case with most recent expansions, the majority of VCM produced moves in the merchant market. The fourth and fifth large* producers arc oil com panies with large ethylene capacity but jnsuflicien* chlorine-for VCM production. Shell has recently com pleted and started up 12-14 percent of U.S. industry Iflfi February 1973 Hydrocarron Processing TABLE 6-6--Foreign VCM producers Country rB.uIlRiuomre:. (Vrchmlonlila: Finland!.............. France:................ Greece i Italy: .. Netherlaodat ...... Rumania! ......... Spain:....................... SUw. Red.e:.n..:......................... USSR:........................ Wee* Germany* . LATIN' AMERICA Argentina:.............. Braail:....................... Chile:...................................... Mexico:.................................. Venezuela:........................... AFRICA/MIDDLE EAST E&ypti............ ................... Turkeys .................................. ASIA/PACIFIC Australia:......... Japa&f............ Korea i ... Taiwan: .. Thailand: Compflny BASF Solvie Limhurxiw Vlnyt Technorxport Pckemn Oy DAUFAC Pccbiney-Saint-Cobian Soleay F.thyl HeBar AN1C Montedison Rumlanca Industrial Import Monsanto Iberica Oxycroa Viniclor Kemanord B. P. Chemical* British Geon ICI Tectimashimport BASF ChemWerke Huela Itocchst Knapsack AG Wacker Cbcrale Elcctroelor SA1C IndunrisvDs* Con sordo-Paulina Union Carbide Emprrna National* de Petroteo Feiroouimiea.Dow-ENAP PEMF.X B. F. Goodrich/IVP/olher* General Organization for Industry PetVim Peirokimya Goodrich Asahi-Penn ChcmieaJ Central Chcm. Chiba VCM Chi>*o Petrochemical Japanese Geon Ksnensftichi Kaaei Muushlma Kurrha Mitsubishi-Monaato Mitsui Mitsui Teatra Nihon VCM Senpoku Petro-chemica) Toyo Soda Korean Pacific Chemical Chinese Petroleum Taiwan VCX1 Thai Plastic City Antwerp Jemcpre Tesvnderloo Novaky Porvoo LaVera Tavaux Ravmn t Porto Marghera CacUaif Botlek Pemls Rimnieo Vficea Tarracona Puenotlano Martoreli Sttnunesund Parian Bay. Wales Hilthouse Rnncona Djerjinskl Gorki Marl Knapsack Koln Bnryhauses Capltan Bermuda Bahia Blanca . Elclnr Sao Paulo N. A. El Tablat* limit Yarimca Got Chiba Osaka YoklcalcM Nihon Osaka Tokoyama Bantkok OAnnunl capacity (thousand metric tun 120 200 2U0 flO SI 90 120 120 200 v2a5 230 1A0 100 (expanded) 300 75 38 50 SO (planned) 55 75 200 140 N. A. N. A. 30 33 300 365 (expanded) GO (planned) 100 N. A. 50 (planned) 50 (planned) 100 100 85 15 IpM 15 (plan) 70 50 43 (planned) 30 05 (planned) 27 (planned expansion) N. A. 145 (EDO 00 (EDO 180 55 130 120 50 120 to'.................... N. A. 80 1n2o0 100 00 04 60 (planned) 40 PremAMm|>tttl*n Stauffer Rolvay--ICI Good rich Coodrtrh/1 loeehrt Solvay/iCJ Ethylene fexpnndinj) Own (1072) Elh ylcrr-hawd (1972) balanred acciylene/ethylese Ethyl EDC cracking Stauffer (completion)) Goodrich (1971) PPG <0Tf) Good > ich/5tauffer nVa!..................................... Monaanto/Ethylene Goodrich Solvay/ICl (1072) Ethylene Goodrich Acetylene Qxyclilorinalson Oxychlorination P-S-C (19727) Stauffer (19731) Balanced Huh (1072) Goodrich/Hoertm Goodrlch/Hoeehal Acetylene (1071) ICI (1973) Dow (1974)____ Ethyl/Solvr/lCl Solvay/JCl . Balanced etlzylene-aeetyien* (1972) N. A. Dow Scientific Dexia B. F. Goodrich (1973) N. A. Solvay/2CI 1974 1973 Goodrich '` PPG Toyo Soda Stauffer ___ Toyo Seda (1972) Balanced. Goodrich Stauffer Montanto/Sclenfific Dcsiia Balanced Mitsui...................................... Scientific De*Ha Stauffer Mitsui Toyo Soda ToyO Soda Dow XIonranto/Tokoyama Union Carbide (1972) Dynamlt Kobcl Source: Authors' estimate based on many published sources. This 11st Is not intended to be comprehensive, but to list most major producer*. URL 19423 capacity at Houston. Ethylene comes from a gas oil cracker with 1 billion pounds/ycar capacity, but required chlorine is purchased externally. Shell produces chlorine and other chlorinated organics beside VCM, but has apparently chosen not to expand chlorine capacity for use in VCM. With recent announcement of a similar scale VCM unit in Norco, La., Shell will become the largest VCM producer by 1975. Conoco has 10 percent of in dustry capacity at Lake Charles, with cthylme provided by ethane/propane cracking and chlorine requirements purchased. It is reasonable to watch major ethylene and chlorine producers for the next VCM units. HISTORICAL DATA Table 6-7 presents data based on U.S. Tariff Commis sion reports for 1958 through 1969 and the authors' estimates for 1975. These data show a steady rise in the production of VCM, excepting a slump in 1967, when the industry was particularly plagued with overcapacity. Pro duction has grown at over 17 percent per year for the TABLE 6-7--U.S. historical dato: VCM, 1959 to 197S Year Number of producera 1959.... two.... ior.i____ HW2.... 19G3.... 1984.... )9fi3____ llhVl.... 1987... . IBM_____ 1909.... 1970.... 1975.... 10 12 12 12 13 1.1 13 13 1.1 12 11 9 10* Production .MM Ui./jt. 978 1.037 1.044 uu 1.435 1.514 2.000 2.500 2.434 2.009 3.718 a.rew 5.600* Satea MM Ib./yr. AnrnC* price, //lb. Total value of prwt'al JMM 329 352 424 518 501 508 fiss 618 952 1.483 2.1*41 2JI20* 4.200* 11 10 8.1 7.5 7A 63 8.1 SJ 53 4j8 4.4 45* 45* 108 104 85 95 100 103 122 148 128 138 164 150* 252* Source: \J.5. Tariff Commission Author'* estimate*, with price projection in 1971 dollar*. past five years. Average sales price has continually dropped because oxychlorinntion of ethylene, which is accounting for an ever-increasing proportion of VCM production, is considerably cheaper than the acetylene route, and be cause of economics of se.de. Because of these offsetting ..VINYL CHLORIDE Fig. 6-8---VCM production In the United States, U.$. Tariff Commission and authors' estimates. trends, the total value of production has increased only 6 percent per year since 1964. However, it is believed that the average sales price (real dollars) will hold steady through 1975 because of rising ethylene and chlorine costs and that the growth rate of VCM production will be closer to seven percent per year from 1970 to 1975. The future of VCM is directly tied to the future of PVC, and PVC consumption in the United States is ex pected to show an annual growth rate of 10 percent from 1970 to 1975. The trends of VCM production, price and value are shown in Figs. 6-8, 6-9 and 6-10. ECONOMICS .The price of VCM has exhibited the typical downward trend of maturing petrochemical monomers. The major reasons for this trend have been the consistently improv ing technology, the much larger scale of existing produc tion facilities, and the considerable decrease in the price of major feedstocks--ethylene, acetylene, chlorine and hydrochloric acid. As with other petrochemicals such as acrylonitrile, vinyl acetate, and neoprene rubber, the 1960s saw the introduc tion of new processes which replaced acetylene as a raw material with a less expensive feedstock. Even though the new balanced oxychlorination processes (such as Goodrich, StaulTcr and Monsanto processes) have a higher capital cost (see Fig. 6-111 than balanced ethylene/acctylcnc units of the same size, the raw material advantage of ethylene has been sufficient to more than justify the-added capital. At ethylene and acetylene juries of 3 and 8 ccnts/pound, the switch in feedstocks reduces raw material cost by about 1.1 ccnts/pound at normal yield ratios. For a 500-million-pound/year plant, the raw .material savings for balanced oxychlorination amounts to $5 million/year (90 percent capacity). This in turn is more than enough justification for the approximate $3-$4 million increase in capital cost. While two U.S. vinyl chloride producers (Tcnncco and Monochem) have been able to continue operation of highly integrated acetylene complexes, the operation of these units can almost cer tainly only be justified with an out-of-pocket analysis of cost. No new acetylene-based plants will be built in the United States. The economics of a 600-million-pound/year balanced oxychlorination producer are shown in Table 6-8. This analysis presents a single year of the life of the plant at 90 percent of capacity, which can be justified as equally accurate with some of the component cost data. In any case, the economics indicate several notable characteristics of the VCM business. First, the two raw materials com prise two-thirds of the 8 percent profited manufacturing cost of VCM. With the large economies of scale ia chlorine and the evident trend to oil company domlna- ! I \ ? * ?" - _ 30 ^ <g rsj TABLE 6-8^--Estimated cost of VCM production by ethylene chlorination and oxychlorination Component Chlorine........................ Ethylene....................... Catalyst & chemical*. Stratn (net of credit). Fuel................................ Cooling water.............. Electricity... .............. 2% royalty.................. Total Variable costi.. Operating labor & supervision........................................... . Maintenance 10% oi BL. capital)...................................... General overhead of operating ft maintenance) Taxes Insuranre and rental* of fixed capital).. 15',# capital charge to earn 6Vi on fixed investment.. Z% working capital interest.............................................. . Total Rieichtrtet......................... ................... ............... %% profited manufacturing cost (F. O. B., plant) Ueaflc rat* (per lb. VCM) 0.63 lb. 0.47 lb. 13 lb. .0018 MM Bta. 31 cal. O.l KWH Input prlc* (r/unlt) 2.25 3.00 .05 25 .003 A Manufacturing coat (Thousand S/yr.) (iflb. VCM) S 7.050 7.600 550 4SO SO* 630 300 00 1.43 1.41 0.100.OS M .10 M .09 $17,800 X20 S 300 1.000 450 3S0 3.000 200 t 5.000 823.700 1.09 4.38 v Baii*: Usage rate* and capital coat* are derived from published claims. See especially Spits. Peter. "Vinyl Chloride Economic*." Chrmictl Faparrriaf Prot'tti * r,4:3:19-2ti. March 1'JiW. . 000-million.(jonnd/year Gulf CtuM plant (F. O. B.) Working capiUil - one tnnntl) of VCM sulei value. Capital cost IG on-site* (million dollars) 8 off-site* Note: . 34 Total 11 ye ar taxable life IS *xar estimated trsefullife_ . This is a stf-.nl y-M;ile calculation for one year at 905# of Opacity; a more accurate discounted cash flow might produce a noticably different price. No by product credit* or di.pod cost* are included: credit* for chlorinated solvent* feedstock* are assumed to balance heavy and light ends disposal costa. i i F J 4 i 108 February 1973 Hydrocarbon Processino TABLE -9--JontlHvlty of VCM monufotfwrJng cost fo miumptlent A ehanfte In ihl* Input Chlorine price....................... ................. Ethylene price........................ ........................ Energy com (fuel, steam, electricity).. Operating & maintenance cost*................ (without inctea* in overhead) Cemirueiioo com*............................ .. By thla amount S5/lon 0to.2S%eenti/nound 10% to % Chnnce* coat of VCM by imt/iobu.n) t o.uv 0.13 0.03 0.03 0.07 Source: Derived from previoua estimate of F. O. B. manufacturing coat. URL 19425 tlon of ethylene production (primarily because of byprod uct handling from heavier feedstock cracking), the vinyl chloride business is the obvious domain of both large chlorine producers (Dow, PPG, Goodrich) and large ethylene producers (Conoco, Shell, Dow and Union Car bide). This definite trend should continue for the fore seeable future. A second notable feature (to the extent that these published data are accurate) is the low profit margin on recent VCM contracts. With the average price of VCM sales (reported by the U.S. Tariff Commission) ap proaching 4/a cents/pound, it is evident that new VCM plants must be operated very efficiently and with minimal startup difficulties to yield any reasonable return to VCM producers. The sensitivity of a VCM operation to the various manufacturing cost components is presented in Table 6-9. This indicates the probable upward pressure on VCM pricing In the event of increasing costs for fuel, construction, and ethylene which have been characteristic of 1970-1971. A recent development in VCM manufacture was the announcement of a process to pioduce VCM directly from ethane, chlorine and hydrochloric acid. The "TRANSCAT** process, as it has been dubbed by its inventors and potential licensors at Armstrong Cork and Lummus, claims to have economics superior to the bal anced oxychlori nation process. Yields and raw material prices have been reported as superior to oxychlorination ahd.-capital costs seem to be comparable. This process presents *a potential reduction in manufacturing cost of about -I cent/pound if these characteristics are present iii. commercial-sized plants.14 No announcements of a commercial TRANSCAT venture have been made public to date. A final, developing factor in VCM economics is the production of 3-5 percent chlorinated byproducts by most oxychlorination processes. While most of these are suit able feedstocks for chlorinated solvents manufacture, a fraction are suitable only for disposal. As environmental laws impinge on the more economic means of disposal-- atmospheric venting, deep wells and deep sea dumping-- the VCM producers will be forced to more expensive disposal means. These costs will exert an unknown, but potentially significant, upward pressure on VCM price. Fig. 6*9--U.S. VCM average selling price, authors' estimates and U.S. Tariff Commission. Fig. 6-10--Value of U.S, VCM production, authors' estimates and U.S. Tariff Commission. Ffg. 6-11--Fstlmated battery limit capital eost for VCM pro cesses." Yhe future Despite production volume which indicates approach es maturity in its life cycle, vinyl chloride continues, to 8row at a rapid rate. This growth has resulted from extension of PVC and copolymers into new materials applications. Replacement of older materials--such as tccl and iron in pipe, glass and paper in packaging--will 'ontinuc to provide the major impetus to PVC and, therefore, `'CM growth. While these markets are them selves inrv.irc and growing only moderately, their very size allows 15-20 percent annual growth of PVC con sumed from only moderate inroads. At the same time, older PVC markets are maturing noticeably and will exhibit growth of 5-8 percent. The upshot will be PVC consumption growth of 10 percent from 1%9 to 1975 and l!x---------- VINYL CHLORIDE a lower 7 percent growth of VCM production because of a decreasing proportion of exports. VCM manufacturing costs have been rapidly approach ing feedstock values. VCM sells for 4.5-5 cents/pound, ethylene for 3-3J4 cents/pound, and chlorine for 2-2.5 cents/pound in large scale contracts. Therefore, nearbalanced oxyehlorination Is not likely to be supplanted as the major VCM process unless the change to even less expensive feedstocks is involved. Not enough information is available to assess the commercial success of the re cently announced TRANSCAT process to convert ethane directly to VCM. If preliminary information is confirmed, watch for TRANSCAT to be employed on a very large scale. Location of new VCM production will be determined by availability of low-cost hydrocarbons, with VCM transportation by water, pipe line and rail acting as a constraint. If present erosion of U.S. Gulf Coast ad vantages continues, large VCM markets will draw new producers to the North and East. The companies which build the next few VCM plants will be those with captive supplies of ethylene, chlorine or both, and those with considerable VCM operating knowhow. Paper-thin profit margins almost preclude en try by any producer that lacks more than one of these three advantages. Look for Dow, PPG and Shell to About the authors David P. Keane t n product manage- i,uut iJ.-Li.iiiu>; /Viden Division ' of the Singer Co. He received an M.B.A. from Harvard Business School in 1970. He also holds an A.B. in economies from Georgetown University, Washing ton, D.C., end the "Certificat" from the University of Fribourg, Switeer- land, in French literature. Robert B. Stobaugii ie a professor at Harvard Business School where he teaches a doctoral seminar in interna tional technology and production. He holds .a B,S. tn chemical engineering from Louisiana State University and a recent doctorate from Harvard Busi ness School. He has served as a con sultant to a number of chemical and oil firms and governments and has en gineering experience with Monsanto, Caltex Oil Group and Jersey Standard affiliates. He has written numerous articles and two books, Petrochcmieall Manufacturing and Marketing Guide, Volume 1 and II (Gulf Publishing Co.). Phillip Townsend is an industrial con sultant and working toward a doctorate at Harvard Business School. His spe cial field ts production and operations management, particularly in petro chemicals. He has held technical and managerial positions with U'.R. Grace, American Oil ar.d Shell Chemical. Mr. Townsend received a US. in economics and chemical engineering from M.I.T, and an JI/.S. in chemical engineering from Purdue. CUMULATIVE PRODUCItQW KPRlENC^-MUiJQN POUNDS Fig. 6-12--Experience curves for VCM price, PVC price, and value added by polymerizes Source; U.S. Tariff Commission, Boston Consulting Group, and Manufacturing Chemists Asso ciation figures are combined with the GNP deflator (1958 base year) and authors' eslimaies of future production. A 3 percent inflation projection through 1975 Is incorporated. continue expansion, with Union Carbide and Monsanto considering eventual reentry of VCM production. Intro duction of a successful ethane-based process, however, would cause chlorine producers to dominate future pro duction. Based upon these trends (see Figs. 6-4, 6-5 and 6-6) we predict that production of VCM almost exclusively from ethylene will reach 5.6 billion pounds by'1975, with merchant sales at a price of 4.5 cents/pound (1971 dol lars) . This will result in an imputed value of $252 million for 1975 production (1971 dollars). These large contracts will be written with escalation clauses to offset increasing power and hydrocarbon costs. Fig. 6-12 presents the history of PVC and VCM pric ing, as well as the value added by polymerizers. Projection of the decreasing polymerization margin (using cumula tive production experience versus price) gives a further estimate that average 1975 PVC prices will approximate 11 cents/pound (in 1971 dollars).*1* LITERATURE CITED lr^(n Climiul Vw Polymer Intermediate*, Oct. SO, 1970. p. S. 1 Hydrocarbon Pro,mine, November 1967. p. 239; Chemirai Week, Au$ 29. 1964. ' "Foulgo Aid for Vinyl,*' Ckemieal Weft, Sept. 24, 1966. * HyJrotorl'on Proecning, November 1969, p. 249. * Hydrorarbox Proeruing, November 1969, p. 216. * European Ckemieal Next, April 30, 1971, tnd OS til Cat Journal, No*. 8. 1971. 1 Chttnieal Engineering, April 22, 1968, pp. 142*144. * Firilin;, Huron and Summerville. "Which Fcrdaiock tor Ethylene,** Hydra- eari/n* rroetiting, November 1968. p. 149. Faith, Keyes and Clark, Induitrial Chemicals, Wiley, 3rd edition, 1963, p. 809. i* "Polyvinyl Chloride: Outlook and Opportuoilier," John Auchter (R. G. Goodrich), Chemical XIarketinc Xmeaiieh Auocialioo, Ntv York, XIay fc 1971. u CArmtrof Week, Au*. IQ, 1971, p. 26. Cktmieal H eel, May 24, 1969, p, 32. Oil, I'ainl end Drug tleporltr, Xfay 3. 1969, p. 3. ' The Oil and Cat Journal. March 8. 1971', p. S3. u For an explanation ol tltc experirnce curve method of price forecasting. ace t)>e vanoui publication! of rite UvMon Comuliing Croup, including, "Ter* spcciitri on taper ience," ILoton, 1968. M "Vinyl Chloride Economics,** I'rter Spill, Chemical Engineering Pragtill, March 1908, p. 19-26 with appropriate escalation factors to 1971' applied by author. "" END OF SERIES