Polyurethane Foam in Furnishings Markets - American Chemical Society

2 Polyurethane Foam in Furnishings Markets R. C. SNYDER

Downloaded by UNIV OF PITTSBURGH on October 25, 2015 | http://pubs.acs.org Publication Date: November 30, 1981 | doi: 10.1021/bk-1981-0172.ch002

The Dow Chemical Company, Organic Chemicals Department, Midland, MI 48640

Industry Structure The furnishings market for flexible urethane foam can be divided into three major segments: furniture, bedding, and carpet underlayment . These markets are supplied flexible foam by a larger number of firms known as the flexible slab foam industry which convert liquid chemicals to large foam buns made on a continuous conveyor. An infinite variety of cushion shapes are fabricated from the large foam buns. Although on the order of 90% of the foam volume used by the furnishings industry is made by the flexible slab foam industry, molded flexible foam is also used for some commercial furniture and mattresses. Most of the molded foam is used by the auto industry. The flexible slab foam industry is characterized by a large number of individual firms which frequently have multi-site foam production and fabricating locations. These are located around the major furniture manufacturing centers of the U.S. and the other major metropolitan markets for serving the bedding and carpet underlayment markets. The Total Market The furnishings industries account for about 60% of the almost l.U billion pound production of flexible urethane in 1979· About 60% of the furnishings volume is used by the furniture industry while mattresses and carpet underlay about equally divide the remainder. The consumption of polyurethane foam has matured since 1973· Rapid growth occurred through 1973 due to penetration and/or replacement of rubber and spring cushions in upholstered furniture, other seating including auto and transportation, and bedding applications. 0097-6156/81/0172-0025$05.00/0 1981 American Chemical Society

In Urethane Chemistry and Applications; Edwards, K., et al.; ACS Symposium Series; American Chemical Society: Washington, DC, 1981.


26

URETHANE CHEMISTRY AND APPLICATIONS

Beginning w i t h the p e r i o d o f the 197^-75 r e c e s s i o n , f l e x i b l e urethane foam appears to be e x p e r i e n c i n g the more mature segment o f i t s l i f e c y c l e . Over the span o f 13 y e a r s , f l e x i b l e urethane foam has experienced a compounded growth r a t e o f 11% per year (Figure l ) . Economic c y c l e s impacted the growth twice during t h i s p e r i o d : 1 9 7 0 - 7 1 and 1 9 7 ^ - 7 5 · The peak-to-peak growth r a t e over the f i v e - y e a r p e r i o d 1973 t o 1978 was 3·8% per year ( F i g u r e 2 ) . Growth had continued during the p e r i o d but a t a moderate r a t e as f l e x i b l e polyurethane foam has b u i l t volume l ) i n carpet underlay a t the expense o f sponge rubber, and 2 ) because o f the popular waterbed which uses foam f o r a dual s t r u c t u r a l and cushion purpose. Foam volume i n 1980 w i l l continue the d e c l i n e begun i n 1979 i n response to the decreased l e v e l o f economic a c t i v i t y . Auto, t r u c k , and r e c r e a t i o n a l v e h i c l e production d e c l i n e s c o n t r i b u t e d to the 1979 foam volume drop. The l a r g e production worker l a y o f f s i n these and r e l a t e d i n d u s t r i e s i n e a r l y 1980 caused a r e d u c t i o n i n consumer purchasing power and impacted o v e r a l l consumer psychology, thus the f a l l - o f f i n home f u r n i s h i n g s demand in

I98O.

Expectations a r e f o r a 12% d e c l i n e i n f l e x i b l e foam production i n I 9 8 O . The t o t a l p e a k - t o - v a l l e y d e c l i n e over the three-year p e r i o d 1 9 7 8 - 8 0 i s f o r e c a s t a t 15%. This compares w i t h a 1 5 · 5 % d e c l i n e over the two-year p e r i o d o f 1 9 7 ^ - 7 5 · F l e x i b l e Urethane Foam

B i l l i o n lbs % Change

1977

1978

1979

1980

1.35 +9

1.U2 +5

1.38 1.21 -2.5 -12

1981F

1982F

1983F

I98I+F

1.30 +7

1.1+1 +9

1.51 +7

1.60 +6

The peak-to-peak (1978-8*0 growth r a t e expected during the c u r rent business c y c l e i s only 2% per year even though the l a s t four years w i l l be i n the 7-9% per year range ( F i g u r e 3 ) · The u t i l i z a t i o n o f f l e x i b l e urethane foam i s b e l i e v e d to be i n the mature phase o f i t s l i f e c y c l e ; thus the growth outlook i s dependent on the l e v e l o f consumer spending f o r durable goods during the growth years coming out o f the c u r r e n t r e c e s s i o n (1982-81+). The F u r n i t u r e Segment Demographic data suggests that 1975 t o 1985 should be a strong p e r i o d f o r home f u r n i s h i n g s s a l e s . The age group 18-3*+ w i l l i n c r e a s e by 28% during t h i s ten-year p e r i o d . The Conference Board p r e d i c t s that the number o f households w i t h heads under 35 w i l l reach an unprecedented 35% o f t o t a l households by 1 9 8 5 · Home f u r n i s h i n g s buying should be s t i m u l a t e d by t h i s r a t e o f household formation by people i n t h e i r prime buying age.


SNYDER

Polyurethane Foam in Furnishings Markets

Billion Pounds


2.0

66

67

68

69

70

71

72

73

74

75

76

77

78

79

80

Figure 1. Compound growth rate of poly etherflexibleurethane foam.

Billion Pounds 2.0

66

67

68

69

70

71

72

73

74

75

76

77

78

79

80

Figure 2. Peak-to-peak growth rate of poly ether flexible urethane foam.




Billion Pounds 2.0

73

74

75

76

77

78

79

80

81

82

83

84

Figure 3. Projected peak-to-peak growth rate of polyether flexible urethane f


2.

SNYDER


29

F l e x i b l e urethane foam f o r f u r n i t u r e a p p l i c a t i o n s i s the l a r g e s t s i n g l e end use accounting f o r an estimated 31% l a s t year. Consumption of foam i n f u r n i t u r e was estimated to be f l a t l a s t year and i s expected to d e c l i n e i n 1980. T h i s should be followed by strong growth years i n I 9 8 I - 8 3 which we are e s t i m a t i n g a t 1-9% per year (see below).


Foam Consumption: 1977 Million lbs

1*86

1978

1979

I98O

505

1*96

1*58

+1*

% Change

Furniture

-2

-8

1981

1982

1983

1981*

I+96

5**0

576

60I*

+8

+9

+7

+5

This f o r e c a s t assumes that the f u r n i t u r e segment i s f u l l y penet r a t e d by f l e x i b l e urethane foam. S t y l e changes may impact cushion dimensions somewhat, but are c o n s i d e r e d an i n s i g n i f i c a n t f a c t o r i n the f o r e c a s t . F l a m m a b i l i t y i s s u e s remain u n s e t t l e d ; however, t h i s f o r e c a s t assumes technology development w i l l cont i n u e to keep urethane foam i n the f o r e f r o n t as the best c h o i c e f o r cushioning a p p l i c a t i o n s . The Bedding Segment Data on the bedding i n d u s t r y i s incomplete f o r 1 9 7 9 · Foam matt r e s s p r o d u c t i o n appeared to have d e c l i n e d r e l a t i v e to 1978 but o v e r a l l a d u l t mattress shipments were probably up around 2%. The p e n e t r a t i o n o f the a d u l t mattress market by foam core u n i t s appears to have slowed i n 1 9 7 9 · The a v a i l a b l e i n d u s t r y data i n d i c a t e s foam core i s about 17-18% o f the a d u l t mattress market and i n n e r s p r i n g u n i t s comprising the remainder. Foam Consumption: 1977

Million lbs % Change

155

1978

160 +3

1979

157 -2

I98O

150 -6

Bedding 1981

158 +5

1982

166 +5

1983

173 +1*

1981+

178 +3

The growth i n waterbed p r o d u c t i o n has had a p o s i t i v e impact on urethane foam demand. Boarder or dam components made from a f i r m , h i g h d e n s i t y f l e x i b l e urethane foam has bouyed foam consumption i n bedding despite foams l a c k of growth i n other bedding a p p l i c a t i o n s , i . e . foam cores and topper pads. About 30% of the foam used by the bedding i n d u s t r y i s used to u p h o l s t e r a d u l t i n n e r s p r i n g mattresses. Q u i l t e d covers backed w i t h a t h i n l a y e r o f urethane foam c o n t r i b u t e s to the p l u s h u p h o l s t e r e d look. Foam topper pads cover the i n n e r s p r i n g s and p r o v i d e comfort to the s l e e p e r .



30

URETHANE CHEMISTRY AND

APPLICATIONS

The topper pad a p p l i c a t i o n f o r urethane r e c e i v e s strong competit i o n from garneted c o t t o n f e l t pads. The mattress i n d u s t r y cont i n u o u s l y evaluates the r e l a t i v e c o s t and consumer acceptance o f the two a l t e r n a t i v e padding m a t e r i a l s . U t i l i z a t i o n o f f l e x i b l e urethane foam and the r e l a t i v e share o f the a v a i l a b l e topper pad volume appears to c y c l e w i t h the c o m p e t i t i v e p r i c e pressures perceived to e x i s t i n the r e t a i l mattress market. When mattress p r i c e s weaken due to s l a c k demand, mattress manufacturers appear w i l l i n g to cut c o s t s a t the expense o f consumer comfort and consequently s h i f t a higher r a t i o o f p r o d u c t i o n to c o t t o n f e l t . During 1 9 7 6 and 1 9 7 7 c o t t o n l i n t e r s f o r f e l t i n g enjoyed a low r a t e o f p r i c e e s c a l a t i o n r e l a t i v e to urethane raw m a t e r i a l s (Figure h). However, i n the l a s t two y e a r s , the p r i c e o f l i n t e r s has moved up r a p i d l y to the same range o f urethane raw m a t e r i a l s . 3/80 P r i c e Index

(1975=100)

189*

Cotton l i n t e r s F l e x i b l e foam p o l y o l TDI

162% 182%

The c o t t o n l i n t e r s s i t u a t i o n i s l i k e l y to continue to f o l l o w i t s h i s t o r i c a l c y c l i c a l p r i c e p a t t e r n ; t h e r e f o r e , over the f i v e - y e a r f o r e c a s t p e r i o d i t i s not expected that e i t h e r a l t e r n a t i v e topper pad m a t e r i a l w i l l g a i n a secure p o s i t i o n r e l a t i v e to the o t h e r . Carpet Underlay The consumption o f prime f l e x i b l e urethane foam i n carpet underl a y i s estimated at l U 7 M l b s i n 1 9 7 9 · A d d i t i o n a l l y , 2kM l b s o f foaming bonding agent i s used i n manufacturing bonded urethane scrap underlay. The t o t a l consumption o f v i r g i n urethane mater i a l i s estimated at 171M l b s . Scrap urethane foam consumed i n bonded underlay i s not included i n t h i s underlay volume to avoid double c o u n t i n g . Scrap generated i n the p r o c e s s i n g o f urethane foam f o r each o f the a p p l i c a t i o n s p r e v i o u s l y d e s c r i b e d i s i n c l u d e d w i t h the foam f o r that a p p l i c a t i o n . Prime urethane underlay continues to grow a t the expense o f w a f f l e sponge rubber and f i b e r pad. Since 1 9 7 7 prime urethane underlay has grown from 19% o f shipments to 3h% w h i l e rubber sponge has d e c l i n e d from 3h% to 22%. T h i s e r o s i o n o f rubber's p o s i t i o n i s expected to continue during the f o r e c a s t p e r i o d . Foam Consumption:

Million lbs % Change

Carpet Underlay

1977

1978

1979

I98O

1981

1982

1983

198U

Ilk

ikO +23

171 +22

155 -9

165 +6

l8U +11

200 +9

210 +5



SNYDER


Figure 4. Cotton linters vs. urethane intermediates. Price index (12/1975


32



Summary The f u r n i s h i n g s market f o r f l e x i b l e urethane foam w i l l rebound from the current economic downturn w i t h strong growth i n the 1982-81* p e r i o d . The f i r s t volume upturn i s expected i n those p o r t i o n s o f the market that are r e l a t e d to new housing s t a r t s which w i l l r e v i v e i n l a t e I98O and e a r l y I 9 8 I due to improved i n t e r e s t r a t e s and mortgage money a v a i l a b i l i t y . The major foam volume, however, i s dependent on the replacement market i n f u r n i s h i n g s which w i l l not show s i g n i f i c a n t improvement u n t i l unemployment r a t e s and consumer psychology improves. The timing o f the turn-around and the magnitude o f the upturn w i l l depend on f u t u r e economic p o l i c y and the impact on the l e v e l o f spending by consumers f o r durable goods. F l e x i b l e Urethane Foam Pounds, B i l l i o n s

A l l Uses Furniture Bedding Underlay % Furnishings

1979

I98O

1981

1982

1983

1981*

1.38 O.5O 0.16 0.17

1.21 0.1*6 0.15 0.l6

1.30 O.50 0.16 0.17

1.1*1 0.51* 0.17 0.18

1.51 0.58 0.17 0.20

1.60 0.60 0.18 0.21

60

63

63

63

63

62

RECEIVED June 1,1981.


Polyurethane Foam in Furnishings Markets - American Chemical Society

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