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Another Force Majeure Hits the US Polypropylene Market
March 31, 2022
A second major North American resin producer has declared force majeure (FM) on Polypropylene in as many days, which comes alongside rising resin prices, strong demand, and tight supply availability.
In a letter to customers on Thursday, Ineos Olefins & Polymers said it was declaring FM on its Polypropylene grades following a power outage at its Carson, California, facility, which caused a manufacturing breakdown and/or failures. The company also said it was diligently working to return production capacity to normal levels as quickly and safely as possible.
The Ineos FM comes one day after LyondellBasell declared force majeure on PP grades at its facility at Lake Charles, Louisiana, due to a mechanical gearbox, which will impact its PP extrusion capacity and limit its ability to produce certain grades of PP
Both FM's also come as domestic Polypropylene (PP) spot prices sit at the highest level so far of 2022 amid strong demand from processors and resellers, and strained supply availability. Current PP Homopolymer and Copolymer prices reside at $1.02/lb and $1.12/lb, having jumped up $.02/lb this week to match the season's high established earlier in March.
Prompt feedstock Polymer Grade Propylene spot levels have also increased this week with confirmed April transactions as high as $.68/lb on Thursday, which was above last Friday's April closing price of $.65/lb.
By Brian Balboa for The Plastics Exchange.
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