14 May 2008 06:43 [Source: ICIS news]
By Cheang Chee Yew
SINGAPORE (ICIS news)--Transport links damaged by the massive earthquake in Sichuan province in southwest China were hampering product deliveries and relief efforts in the region and restoring them have become priority, industry officials said on Wednesday.
More than 12,000 have died in ?xml:namespace>
In a high profile response, state television showed Premier Wen Jiabao at the scene, comforting survivors and overseeing relief efforts.
PetroChina and Sinopec have each provided CNY 10m ($1.4m) in disaster relief. The former will also supply 100,000 tonnes of refined oil to the region, while the latter said it has offered personnel and special groups to provide support for the relief effort.
Highlighting land logistics issues, the Chinese military was planning to air drop aid to Wenchuan at the quake’s epicentre, state media reported.
Railways and roads linking
Rail transportation from
“We have not been able to contact our office in
Most of the plastics processors in
“One of our customers in Dujiangyan, a high density polyethylene (HDPE) pipe manufacturer, had not been contactable since the disaster occurred,” he said in Mandarin.
With the movement of medicine and food assuming priority over other products, polyolefins supply would be short in the province in the near term, he added.
The dislocation of the transport network in
While not directly affected by the quake, acetic acid makers such as Yaraco have found it difficult to deliver their products as available transport links were being used to move food and relief supplies, domestic market officials said.
Eastern China-based acetic acid producers raised ex-tank prices by yuan (CNY) 50/tonne yesterday, and by another CNY100/tonne today to CNY5,550-5,650/tonne as buyers emerged to stock up on supply concerns ahead of an impending heavy plant turnaround season.
Polyvinyl chloride (PVC) traders, too, expect supplies to tighten in the Chinese domestic market and regional prices to rise.
The earthquake forced PVC makers in Sichuan, with a total production capacity of around 1m tonnes a year, to shut down their plants since Monday as a safety precaution. No damage to the plants was reported but it was not clear when any of the plants would resume operations.
Local sources noted that the plants were mostly likely able to resume operations only when the logistics bottlenecks are overcome.
The government had already suspended rail services between
The first would be an increase in Chinese demand for imports from other northeast Asian locations such as
The second would be an increase in Chinese domestic prices, creating the leeway for other northeast Asian producers to raise their offers, thereby indirectly leading to an increase in import prices, they added.
Chinese-produced PVC is usually the most competitively-priced in the region, and is seen as the limiting factor on prices of PVC produced in other locations.
The earthquake also prompted
The earthquake had not disrupted plant operations, but some local producers such as Lanzhou Petrochemical and Dushanzi were experiencing difficulty in transporting MEK cargoes as railway services have broken down.
An Asian titanium dioxide producer said that it was not clear if the Sichuan Lomon plant (80,000 tonnes/year) has been affected by the earthquake.
If it is, it would have a major effect on domestic TiO2 prices in
Meanwhile, business is getting back to normal for two large methanol plants in neighbouring city of
The 450,000 tonne/year Chongqing Kingboard had shut on 12 May but restarted normal operations on 13 May, said a company source. The other 300,000 tonne/year Chuanwei methanol facility had also restarted operations although at low rates due to shortage of natural gas, said company sources.
Overall, the impact on methanol markets was minimal as a large part of
Methanol prices in the coastal regions of
For another product, a polyethylene terephthalate (PET) bottle chip seller said that natural calamities such as last year’s floods in southern
Ethylene buyers in
($1 = CNY6.99)
Ng Hun Wei, Chow Bee Lin, Prema Viswanathan, Helen Lee, Peh Soo Hwee, Anu Agarwal and Hong Chou Hui contributed to this article
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