Several economic reports out this week paint a largely positive picture for the recovery, but polyethylene production was down, according to the latest report from the American Chemistry Council (ACC; Arlington, Va.).
Consumer confidence and personal incomes are generally on the rise, ACC writes in its May 28 Weekly Chemistry and Economic Report. "Although consumer spending featured only a minor gain in April, looking at the data over the past year, it appears that consumers are opening their wallets," says the report.
Housing reports out this week were "very positive," ACC points out, but the rosy numbers likely reflect a flurry of activity to take advantage of the waning days of a housing tax credit that has now expired. A looming question will be how the housing market responds once those supports are no longer in play. "A slow recovery is likely" in that sector, ACC remarks.
Globally, ACC cites a report from the Organization for Economic Cooperation and Development (OECD) that suggests economic activity in OECD countries is picking up faster than expected, but volatile sovereign debt markets and "overheating" in emerging markets present increasing risk to the recovery. "Debt crises in Greece and Spain began to look less ominous for the world economy," ACC states, pointing to strong growth in industrial production in Asia.
In the U.S., production of high-density polyethylene (HDPE) resin fell to 1.31 billion lb in April, and production was down 7.6% compared to last year, while sales and captive use rose 2.8% from last year. Similarly, production of linear low-density polyethylene (LLDPE) resin fell to 1.12 billion lb, and low-density polyethylene (LDPE) fell to 575 million lb, ACC data suggest. Together, production of the three major polyethylene resins are down 2.8% compared to last year.
ACC also reported that domestic production of polypropylene resins fell to 1.43 billion lb in April, off 0.4% from a year ago.