National Harbor, Maryland - Flexible foam slabstock production in the US fell by 25 percent in 2008 compared to 2007, a new American Chemistry Council (ACC) market survey has revealed.
The 2008 end-use market survey on the polyurethanes industry in the US, Canada and Mexico, which was conducted by IAL Consultants on behalf of the Center for the Polyurethanes Industry (CPI), said that the drop in production was due to a decrease in furniture production because of a "lack of consumer demand and imports," a 9 Oct CPI statement said.
Overall production of PU in NAFTA (North American Free Trade Agreement) was 3 425 kilotonnes in 2008, a 6.7 percent decline over the past two years, reflecting a 7.7 percent annual decline in US markets from 2 824 kt in 2006, and a 10.8 percent decline in Canada to 265.2 kt in 2008. Meanwhile, Mexico reported positive growth of 9.6 percent over the past two years, the survey indicated.
"With the dip in automotive output, decreased consumer spending, high levels of imported furniture and a drop-off of activity in new housing starts, we were prepared to see a decline in polyurethane production in the US and Canada," said Neeva-Gayle Candelori, director of CPI.
In terms of region, Canada's reliance on the US as an export market resulted in a greater decline in production than seen in the US, the statement said. The US, which represents 81 percent of total PU production in NAFTA, saw flexible foam slabstock account for 16 percent of total production, down from 21 percent in 2006. The decline in housing starts in the US also led to 54 percent of OSB (oriented strand board) production being idled, the ACC said.
With the push towards "greener" living the US population continued to buy products marketed as "eco-friendly."
Rigid polyurethane foam - an insulation material, for example, accounted for 39 percent of production in 2008, compared to 28 percent in 2006, "another sign of interest in greater energy efficiency," the statement said. Around 6500 million lbs of rigid PU foam was produced in NAFTA in 2008.
In the construction industry, new housing starts were down although demand for spray polyurethane foam (SPF) as internal wall insulation increased thanks to an increase in remodelling and repair work. A General decline in moulded seat foam for vehicles was related to the general downturn in automotive production, the ACC said.
According to IAL's research, signs of growth in the PU industry included increases in SPF demand for residential and industrial applications, as well as military applications such as insulating tents for the US Army at bases in the Middle East. The statement also pointed out that PU is now being used in medical applications for wound dressings, mobility aids, reliable drug delivery and hygienic hospital aids.
"Its both a challenging and exciting time for the polyurethanes industry," said Candelori.
"We remain hopeful that while total production volumes have been low, research and development continue and that the polyurethanes industry will have a raft of new products and applications by the next survey," added IAL associate director, Angela Austin. (RD)