Volume 8, Issue 2 - February 2007

Industry Indices 

STUDIES

PVC Demand in China on the Rise

Demand for polyvinyl chloride (PVC) in China will rise 8 percent annually through 2010 to twelve million metric tons, according to PVC in China, a new study from The Freedonia Group Inc., a Cleveland-based industry market research firm. The raise will be driven primarily by healthy (although moderating) growth in construction expenditures, as well as by advances in consumer spending and the growing share of plastics in packaging applications. In 2005, China consumed 8.2 million metric tons of PVC, passing the United States to become the largest consumer of PVC in the world. These and other trends are presented in the study.

Extrusion is the most important process used to manufacture PVC products in China, with extruded products projected to make up more than half of the market in 2010. This growth reflects good opportunities for PVC in the construction market, which accounted for more than 70 percent of extruded products demand in 2005. The second largest end use, molded products, will grow more than six percent annually, based on strong demand in packaging applications.

The study reports construction is the largest market for PVC resin due to the growing use of PVC building materials, such as for windows and doors. Demand for these products will be driven by efforts to reduce energy loss from buildings and to lower costs for both production and maintenance. Demand for PVC resin in the consumer and institutional market will be restrained by competition from materials such as polyurethane. 

Remodeling Market Strengthened in Third Quarter

Remodeling activity picked up in the third quarter of 2006, according to the National Association of Home Builders’ (NAHB) Remodeling Market Index (RMI). The current market conditions index increased from 45.6 to 47.8 on a seasonally-adjusted basis and future expectations moved up by nearly two points to 45.4. The RMI measures remodeler perceptions of market demand for current and future residential remodeling projects.

“Though market strength varies across the country, we are pleased to see a rebound in remodeling activity,” said Remodelors™ council chairperson Vince Butler, CGR, CAPS, GMB, a remodeler from Clifton, Va. “The trillions of dollars in homeowner equity combined with the growing age of the housing stock means that the remodeling market will remain relatively strong in the face of a slower housing market.”

Current market conditions in the South and West jumped back into the positive range, up to 51.1 and 51.4, respectively. The future market conditions in both areas increased by more than six points to 50.4 in the South and 56.8 in the West. In the Northeast, current market conditions remained the same at 46.6 while future conditions increased to 47.7. Current conditions in the Midwest grew from 41.3 to 45.4 while future conditions moved from 40.6 to 38.3.

The RMI “special questions” section asked about energy efficiency and “green” remodeling trends. Of remodeling companies surveyed, 25 percent saw an increase in demand for energy features within the last three months, compared with 69 percent who saw no change. Of common energy-saving materials installed within the last three months, the most popular were low-energy windows (86 percent), and insulated exterior doors (69 percent). 




DWM

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