A reduction expected in polyethylene supplies in October due to multiple plant issues

23-Sep-10

Polyethylene supplies are expected to be reduced in October, as some producers are faced with technical issues or production cuts at their facilities, as per Platts. These include Middle Eastern producers SABIC, Equate and Petro Rabigh, Taiwan's Formosa and Malaysia's Titan Chemicals. Prices are expected to be rolled over for October. October allocations from SABIC are expected to be reduced due to technical problems at it’s joint venture complex in Yanbu. Yansab, had to shut its cracker on September 10 as a "result of technical failure", impacting production of ethylene and propylene. The shutdown is expected to continue for the next 1-2 weeks. Petro Rabigh will offer only half of its usual allocation of polymers in October as the company's polymer complex in Rabigh recovers from an outage in August, for repairs to be conducted at its oxygen and nitrogen production units. Kuwait's Equate is estimated to have reduced October PE allocations by about 10% for undisclosed reasons. Taiwan's Formosa Plastics Corporation has reduced operating rates of its Mailiao polyethylene plant to about 70-80% due to a shortage of feedstock ethylene due to a fire at Formosa Petrochemical Corporation’s No. 1 steam cracker. FPC also plans to shut its 180,000 tpa high density polyethylene plant at Linyuan in November for 10 days of maintenance. Malaysia’s Titan Chemicals has plans to shut its 230,000 tpa ExxonMobil-licensed LDPE and its 115,000 tpa Mitsui-licensed HDPE line in Pasir Gudang in October. The HDPE's turnaround will be brought forward to September 26 as the company is facing feedstock shortage.