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July 06, 2015 02:00 AM

EuPC continues to shine a light on force majeure issues

PLASTICS NEWS EUROPE
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    The Brussels-based European Plastics Converters (EuPC)'s Alliance for Polymers is focusing on responses to a recent spate of force majeure declarations by the European polymer production industry. 

    The EuPC said that production lines across Europe had been forced to stop at the plastics converting level due to material shortages prompted by 40 force majeure incidents in the space of just four months. 

    The Alliance for Polymers for Europe said it would provide detailed information on the current polymer market, while assisting raw material users through its network of national plastics associations and aiding companies in requesting suspension of certain EU import duties to relieve the current shortages on polymer markets. 

    The Alliance will be open to those companies and associations in Europe that needed more information on how to supply their business with polymers in the next five to 10 years.  

    EuPC president Michael Kundel said the organization had set up the alliance to fight what he called an “unjustified situation” around some recent force majeure decisions.

    “It seems that after months of low oil prices, the petrochemical industry appears to be clawing back margins in the polymer value chain by stopping some crackers in Europe one after the other. This situation is very serious, risking future customers for raw material producers and raising several antitrust concerns.

    “Due to the increased pressure of several trade associations, users, OEMs and brand owners, the European Union authorities are starting to look deeper into these force majeure situations.”

    The Alliance is also set to launch a study looking at aging polymer production sites in Europe to provide more transparency after some sites have announced more than 11 force majeure declarations in two years.  

    A search for more material to be imported from outside the EU will be carried out, as well as group purchasing platforms, in compliance with EU competition law, potentially being created, states EuPC. 

    Ron Marsh, former head of packaging firm RPC Group, is to lead the Alliance and report to the EuPC steering committee.

    Marsh said in a statement: “All plastics converters in Europe will now have the possibility to rate their polymer suppliers on specific customers' criteria and some basic commercial and ethical rules will hopefully be reinstated.

    “The best polymer supplier for Europe will be announced next year in 2016 during the EuPC annual meeting in Lyon, France. Hopefully the situation will have improved by then.”  

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