Chemical and resins markets still have excess production capacity in operation, but PURCHASING Magazine's weighted Chemicals Price Index rose to 117.5 in April compared to an average 112.0 in first quarter 2002 because of energy cost hikes, Middle East tensions, and, in some cases, rising feedstock costs. PURCHASINGS Plastic Resins Price Index increased to 113.5 from an average 108.5 in first quarter 2002. But, the increases were uneven across various product lines, and some market analysts suggest apparent April price gains will dissipate in May or June.

Spot styrene prices jumped 15¢/lb to 44¢ in April, but that was due to a short-term supply shortage caused by maintenance turnarounds and production problems. Spot chlorine prices jumped $65/ton, reflecting rising buying interest from the vinyl sector.

Polyvinyl chloride (PVC) resins makers were unable to push prices up in April. Also, butadiene producers have withdrawn a price hike because demand remains too weak, especially from producers of synthetic rubbers, so April spot prices continued to hover in the 13-14¢/lb range.

Producers wanted a 7¢/lb April increase for phenol and a 4¢/lb hike for acetone in anticipation of continued rises in benzene and propylene feedstock costs. The higher prices have not yet stuck. Spot phenol slipped 2¢ in April to 28¢ while spot acetone was stable at 17¢/lb, forcing some mills to reduce phenol operations.