PVC pipe producers had shut down their plants located in Florida on Tuesday and Wednesday in advance of the landfall of Hurricane Ian. By Thursday afternoon, most converters said their plants came through the hurricane with no damage, but would not be able to restart until the restoration of power and water utilities.
Atkore Inc. began shutting down its conduit pipe plant in Tampa on Tuesday, Sep. 27. The plant is located closest to where the hurricane was originally expected to make landfall but dodged a bullet when the storm came ashore further south along the Florida Gulf Coast. Atkore was bringing the plant back up on Friday.
Cantex Inc. shut down its PVC conduit pipe plant at Auburndale on Wednesday morning and was planning on it being down for about two days, depending on the availability of electrical power. Cantex said a nearby power substation was down, and the plant can't restart until the substation is repaired. The company had been told it would be back online by sometime on Friday, after which the pipe plant will be restarted over the weekend.
Charlotte Pipe & Foundry took its plant at Wildwood down on Tuesday and the company expects to restart it on Monday, Oct. 3.
Prime, Inc. took its plant at High Springs down on Wednesday morning. The plant had power on Friday but will come back up on Monday.
Sanderson Pipe Company took down its plant at Sanderson, in the northeast part of the state, on Wednesday. It was expected to restart over the weekend.
IPEX Plastics shut its Fort Pierce plant down on Tuesday afternoon, and it was coming back online on Friday.
By Friday, Ian had emerged into the Atlantic Ocean and strengthened back into a Category 1 hurricane. As of 5 p.m. ET on Friday, Ian had been downgraded to a tropical storm, was located about 20 miles northwest of Myrtle Beach, S.C., and was still packing winds of 70 miles per hour and creating dangerous storm surges along the coast.
It was expected to move northward through South Carolina, and then sweep up through North Carolina.
In Ian's expected path is Atkore's plant in Fort Mill, S.C., which the company said will continue to run.
In North Carolina, Charlotte's plant in Charlotte was reported to be taken down at noon on Friday. Southern Pipe Inc.'s plant in New London and National Pipe and Plastic's plant in Colfax were both expected to keep running.
IPEX has a plant in Pineville and another in Ashville. The Ashville plant looks to be west of the cone of the projected storm track. IPEX did not respond to a query about its operations at either plant.
--Reporting by Donna Todd, dtodd@opisnet.com
--Editing by Anna Matherne, amatherne@opisnet.com and Michael Kelly, mkelly@opisnet.com
© 2022 Oil Price Information Service, LLC. All rights reserved.
Shifts in the downstream polypropylene (PP) market have resulted in drastic downward movements in U.S. Gulf Coast polymer-grade propylene (PGP) prices this week, showing a nearly 9% fall from Monday's open to Wednesday's close.
Fundamentally, U.S. PP showed some weakness at the start of the month, according to market participants surveyed this week.
"Demand is not strong, for sure," a distributor said.
PP is more exposed to durable goods manufacturing than polyethylene (PE). It is used to manufacture household goods, like storage bins, and big-ticket items, such as cars and appliances.
A PP producer noted that efforts to control inflation are likely to slow these key downstream markets, with the automotive plastics compounding sector already showing signs of a slowdown.
In addition, competitively priced and abundant PP cargoes from Asia have been bombarding Latin American markets since the first quarter, which has dampened demand for U.S. product in key markets such as Mexico.
For these and other reasons, North American PP operating rates have been lackluster this year, averaging in the mid-80s through April, according to industry data collected by the American Chemistry Council.
Most suppliers have had either force majeure declarations or sales allocations in effect at some point this year related to mechanical problems, shortages of additives and rail shipping constraints.
Braskem on Wednesday shut down the C Line at its La Porte, Texas, PP complex, after it was discovered that a gearbox for the unit's circulating pump was overheating, according to a regulatory filing with the Texas Commission on Environmental Quality. A market source said the unit was expected to be down for just a few days.
Gulf Coast PP operating rates could be further pressured by the startup of the Heartland Polymers plant in western Canada. The 1.15 billion lbs./year plant, capable of producing 15-20 railcars/day of PP, began production this week, according to market sources.
Heartland Polymers is a wholly owned subsidiary of Inter Pipeline.
"Last year, domestic demand for PP was extremely strong given the import challenges with global freight. As a result, prices for PGP skyrocketed to extraordinary levels. This year, propylene demand into PP, and even into non-PP derivatives, has been lackluster to say the least," Carlo Barrasa, executive director, Olefins for Chemical Market Analytics by OPIS, said.
"Unplanned outages, rail logistics issues and increased international competition have all contributed to the lower than expected operating rates," Barrasa said. "Given the fundamental and economic signals (inbound container freight to US month over month down over 30%, all-time highs on gasoline prices, rampant inflation and rising interest rates), the PGP market is experiencing the mirror image of what was observed last year, most of which is attributed to the lower PP demand down the value chain."
PGP prices started the week with June valued at 53.75cts/lb. at the Enterprise hub (MtB-EPC) on Monday morning, just a penny lower from the month's open. Monday saw a slight decrease, with the front being offered down to 53cts/lb.
Price movements picked up Tuesday with a 2ct/lb. downward move when June traded twice at 51.5cts/lb. and then was offered down to 51cts/lb.
Wednesday saw the most dramatic movements, with June getting offered down half a cent at a time to 49cts/lb. before trading 3cts/lb. below the latest offer at 46cts/lb. However, bids soon inched the front-month price back up, and June traded at 49cts/lb. just before market close.
The forward curve for the remainder of the calendar 2022 strip has held flat so far this week.
With the large price movements, only four reportable trades were completed Monday through Wednesday, totaling 15 million lbs.
The month-to-date (MTD) 30-day physical trading volume for June delivery was 15 million lbs. There has been no forward trading volume yet this month and . There has been no spread trading volume yet this month. Index trading volume was 5 million lbs. Paper trading volume was 50.4 million lbs.
The MTD calendar average for June MtB-EPC PGP was 52.708 cpp. The MTD 30-day weighted average for June TX-All PGP was 49.533 cpp. The MTD 45-day weighted average for June TX-All PGP was 51.92 cpp.
U.S. Gulf Coast propane dehydrogenation (PDH) unit MTD operating rates were estimated at 100%.
--Reporting by Julia Giordano, julia@petrochemwire.com
--Reporting by David Barry, david@petrochemwire.com
--Editing by Donna Todd, donna@petrochemwire.com
--Editing by Adam Burkin, aburkin@opisnet.com
--Editing by Bobbie Clark, bclark@opisnet.com
--Editing by Barbara Chuck, bchuck@opisnet.com
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OPIS PetroChem Wire's Daily Wire provides closing prices and a summary of the day's trading activity for US ethylene, proylene, polymers and upstream NGLs markets. Begun in 2007, its olefins and polyolefins prices serve as benchmarks for a number of physical and swap contracts that trade on the CME/NYMEX Clearport system.
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