Following a 3% gain in March, the Injection Business Index dropped 4% in April compared to April 2006. But according to Economist Bill Wood of Mountaintop Economics, the trend is expected to rise in the second half of 2007 as overall U.S. manufacturing starts to pick up steam. Wood is projecting demand for medical molded products to expand by at least 6% this year, while computers and related equipment will climb by 11%.

Concerning the Extrusion Business Index, Wood reports a 5% decline over the latest month, but again is projecting better business conditions come the Fall. By year-end, Wood’s crystal ball suggests that total output of extruded products will increase by 4% over 2006. The film segment of the extrusion business slipped in April, registering a 3% decline after posting an 11% increase the month before. But sheet is weathering the storm, reporting a 13% spike following a 20% spike the month before. The siding and window/door businesses continue to be rocked by a soft construction market.

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Hourly Rates Data Points to Optimism..…

Meantime, Plastics Technology’s exclusive hourly rates research shows that despite modest recent gains in capacity utilization, molders are optimistic that business conditions will improve in the short term. Our research reveals that some 52% of respondents said they foresaw improving business conditions in the near term, up four points since the first half of last year. Fewer than 16% of molders expected business to worsen, a big drop from six months earlier.

….While Resin Prices Continue to Climb

Materials expenses, on the other hand, continue to put the squeeze on processors. Our most recent research shows that prices of PP, PVC, and PET moved up last month and new price hikes were under way for PE, PP, PS, PVC, and PET. Higher monomer prices fueled hikes for both PE and PP. Demand for both these commodity resins has been flat of late.

Efficiency Defined: Doing More With Less

Plastics processors are doing more with less, the SPI reports in a report titled The Size and Impact of the U.S. Plastics Industry. The report is chock full of interesting data. Consider this tidbit: the number of plastics processing plants shrank 15.3% from 1997 to 2005, and the number of production workers declined by 13.4%. At the same time, the dollar value of products shipped grew 29.2%. The really interesting numbers are the value added per production worker, which increased 37.6%, and the value of shipments per production worker, which grew 45.2%. Presumably, that increased productivity was purchased by investing in technology to replace labor.

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