Some resin assets are restarting in the wake of Hurricane Ida, but many remain down nearly two weeks after the storm hit Louisiana.
The PVC resin market in particular remains hard hit, with plants operated by Shintech Inc., Westlake Chemicals Corp. and Formosa Plastics Corp. USA all down. A feedstock shortage also has led Shintech to idle a massive plant in Freeport, Texas. Combined production challenges in Louisiana and Texas have resulted in almost 60 percent of U.S. PVC production out of action as of Sept. 10.
Sources said that Shintech was in the early stages of restarting PVC operations in Addis and Plaquemine, La., and that Formosa was doing the same in Baton Rouge. Houston-based Westlake has declared force majeure sales limits for PVC, vinyl chloride monomer and related products made at sites in Geismar and Plaquemine.
The PVC outages could lead to higher prices for PVC and related products both in the U.S. and globally, since a sizable amount of U.S. PVC is exported, according to Jeremy Pafford, North America head with data firm ICIS of Houston.
Sources previously said that the Louisiana closings made it likely that a 2-cent PVC price hike that had been nominated by producers for September would be successful. The impacts of the COVID-19 pandemic, two hurricanes in the second half of 2020 and an ice storm that hit Texas in February already have moved regional PVC prices up 24.5 cents so far in 2021 and a net of 40 cents since January 2020.
The storm made landfall on the Louisiana coast near New Orleans on Aug. 29 and made its way across the southern U.S. before bringing heavy rains to parts of the mid-Atlantic and New York. In Louisiana, the storm brought maximum sustained winds of 150 mph. The storm is blamed for at least 82 deaths.
Market sources said that DAK Americas has declared force majeure for PET resin made at its plant in Bay St. Louis, Miss. Pinnacle Polymers also has declared force majeure on polypropylene resins in Garyville, La., and Cornerstone Chemical Co. has done the same for melamine resin made in Waggaman, La.
In Plaquemine, Dow Inc. has begun bringing operations back online as third-party utility balances and raw materials availability allow, officials said in a Sept. 8 statement. Midland, Mich.-based Dow makes polyethylene resin, ethylene, propylene, benzene and other products there. Officials added that the firm will continue to prioritize startups based on third-party utility balances and raw materials availability.
In Taft, La., where Dow's products include linear low density PE, ethylene and propylene, officials said the firm "is making progress toward restart of operations."
ExxonMobil Chemical also is restarting its Baton Rouge complex that makes PE, PP, ethylene, propylene, benzene, plasticizers and other products. The firm was able to keep operating the site at reduced rates through the hurricane.
Officials with Nova Chemicals in Calgary, Alberta, said in a Sept. 10 email that the firm's plant making ethylene and propylene in Geismar "is expected to restart in the coming week." Lion Copolymer also is restarting a plant making EPDM materials in Geismar, sources said.