NEGOTIATOR’S TAKE: Hurricane Harvey has caused chemical and plastic prices to rise |
08.28.17 – American Southwest –
Recent mega-storm shuts 37% of U.S. chlorine output and 40% of ethylene; price gains have been urgently seen in already tight caustic soda market.
Plant closures and operation cut-backs
A third of U.S. chemical production has been disrupted by Tropical Storm Harvey, boosting prices and threatening shortages for basic industrial building blocks such as chlorine and ethylene.
Producers such as Exxon Mobil Corp. and Occidental Chemical Corp. have shut plants and cut back operations in recent days along the flood-crippled Gulf Coast. Those disruptions have affected 37% of U.S. capacity for making chlorine and caustic soda, salt-derived chemicals used to make vinyl and PVC pipe, according to Bloomberg Intelligence.
Significant output of ethylene halted
About 40 percent of U.S. ethylene capacity has been shut, PetroChemWire said in a report Monday. Ethylene is the most used petrochemical and largely goes into plastics such as polyethylene, used in trash bags and food packaging.
The crisis could get worse as Harvey, which made landfall Friday night in Texas as a Category 4 hurricane, is circling back into the Gulf of Mexico and could crash ashore again . . . . Read the rest of this ProPurchaser sourced article, HERE.