Tropical Storm Alberto is bringing some much needed rain to parts of Mexico affected by drought, including Altamira, where large amounts of plastics materials production is based.
The storm made landfall June 20. In a report from data firm ICIS, market analyst Jena Santoro of Everstream Analytics said that the rains could begin to alleviate drought conditions in the area.
Santoro said in the report that although force majeure sales limits remain in place at several plastics sites, the rain "could be the beginning of the end" of drought in the area. The report added that Tamaulipas state government had reduced industrial water supplies by 50 percent in mid-May, leading to production cuts and force majeure actions.
"Obviously, in private, companies are already saying this rain is very welcome," Santoro said.
A June 20 Associated Press story said that Tropical Storm Alberto weakened as it moved inland over northeast Mexico, even as the rain was responsible for at least five deaths in the region.
Lesser amounts of rain were expected on the U.S. Gulf Coast near Houston, where large amounts of resin capacity are based. Schools were closed across Tamaulipas and shelters were prepared across the state to receive residents trying to escape high water, according to the AP story.
An earlier report from San Marcos, Calif.-based Everstream said that industries like medical device, electronics and automotive manufacturing may be impacted because of the concentration of suppliers in Tamaulipas.
On June 14, Boston-based Cabot Corp., which makes carbon black additives in Altamira, confirmed that its manufacturing has been impacted by the drought, A Cabot spokesperson told Plastics News that the plant is operating under force majeure sales limits.
Recent market reports have indicated that DAK Americas and Indelpro also have been affected. Officials with those firms could not be reached for comment. PN has previously confirmed that plants operated by Saudi Basic Industries Corp., Ineos Styrolution, Orbia Advance Corp. and Chemours Co. had been hit by the water shortage.
"Until rainfall volumes begin to increase, forecasts remain firm in predicting that extreme drought conditions in Mexico could remain through the summer," Everstream said in the earlier report. "This is due to a combination of inadequate rainfall, extremely high temperatures and drier-than-typical weather conditions for this time of year."
A spokesman for plastic sheet leader Plaskolite in Columbus, Ohio, said the firm's two sheet operations in Mexico haven't been affected. Officials with Chemours in Wilmington, Del., said May 31 that it had paused production at its Altamira titanium dioxide manufacturing facility. Titanium dioxide is a common plastics whitener.
Orbia has stopped production at a major PVC resin and compound plant in Altamira. The plant has annual production capacity of more than 1.5 billion pounds of PVC resin and also makes flexible and rigid PVC compounds, as well as plasticizers.