Norwalk, Calif. — Expect big increases in polypropylene prices for months in the wake of Hurricane Harvey, an industry consultant warned members of the Western Plastics Association.
Samantha Hartke, a product manager with Houston-based market analyst PetroChem Wire, said it has been a "long three weeks" since Harvey hit the U.S. Gulf Coast and "sat on Texas for a week" impacting the bulk of olefin production.
The storm and other factors created a "more acute shortage" on the PP side than the polyethylene side. The factors include a lack of pending PP capacity expansions.
For PP, the market expects monomer contract prices to increase significantly in September and October, she said.
"I would not be surprised by another price increase in November and another in December," she said.
Many of the storm-impacted PE and PP plants have restarted production, although force majeure situations are more challenging. Flood damage, rail, port and truck logistical issues and start-up volume limitations continue to force processors in many cases to scramble to obtain resins to keep their operations going.
PetroChem Wire closely tracks the U.S. natural gas liquids, olefins, polymers, aromatics and refined products markets.
Hartke reported on petrochemical trends at two WPA dinner meetings: Sept. 12 in Richmond, British Columbia, and Sept. 19 in Norwalk.
On the opposite end of the plastics production lifecycle, conservationist Rachel Lincoln Sarnoff asked WPA members to consider making a "shift paradigm" toward "reusable cups, bags and bottles" rather the current practices processing "too much single-use plastics."
The executive director of the Los Angeles-based 5 Gyres Institute said, "We have to think about plastics in a different way."
Among sustainability examples cited, Sarnoff said computer technology firm Dell Inc. uses 65 percent less virgin resin than before it started an aggressive recycling program.
Round Rock, Texas-based Dell began the pilot phase of a closed-loop recycling project in April 2014.
Sarnoff takes pride in her ocean conservation non-profit's microbeads work.
"We were the first American organization to discover plastic microbeads ? in the Great Lakes in 2012 ? and we campaigned for a successful federal ban," she said in an interview. "We also worked with a coalition of organizations that convinced Procter & Gamble, Johnson & Johnson and L'Oréal, among others, to proactively phase out microbeads."
Initially effective on July 1, 2017, the U.S. Microbead-Free Waters Act of 2015 banned the manufacture and introduction into interstate commerce of rinse-off cosmetics containing plastic microbeads. Other aspects of the law take effect in July of 2018 and 2019. Other countries are enacting bans.
The 5 Gyres Institute's platinum partners include stainless-steel container maker Klean Kanteen of Chico, Calif.; sunglasses and lifestyle retailer Costa Del Mar Inc. of Daytona Beach, Fla.; and omega-3 fish-oil specialist Nordic Naturals Inc. of Watsonville, Calif.
In May, the United Nations Economic and Social Council designated the 5 Gyres Institute for a special consultative status.
The institute's logo says, "More Ocean Less Plastic."
At the same session, regarding health and welfare benefits, Robert Roof told employers in the audience about upcoming compliance, regulation and legislative issues they might confront.
Roof is president of the Lake Forest, Calif.-based Benefits Exchange Alliance agency.
The health and welfare benefits firm, operating as BXA, can help employers stay current with, and understand, the federal and state requirements that can pose problems to their human resource departments.
BXA is affiliated with Acrisure LLC of Caledonia, Mich., a national network of insurance and risk management agencies.
Sacramento, Calif.-based WPA characterizes itself as "the Voice of the Plastics Industry in the West."
