Brazil's Braskem to shut Camacari PET unit by year end

30 December 2008 11:09  [Source: ICIS news]

LONDON (ICIS news)--Braskem will shut its polyethylene teraphthalate (PET) unit by the end of the year as it is not viable to produce the product on a competitive basis, the Brazilian petrochemicals company said late on Monday.

The closure of the unit, at Camacari, would not lead to any job losses and Braskem would ensure the supply of PET resin until at least April 2009, it said in a statement.

Braskem announced the deactivation of its dimethyl terephthalate (DMT) production unit and the temporary suspension of PET production in May 2007.

A study to assess the possibility of resuming PET production using a new technological approach found it would not be competitive. The unit's closure marks Braskem's exit from the PET business.

“The decision was grounded in Braskem’s focus on prioritising investments that provide the company with returns above the cost of capital and that are aligned with its business strategy,” Braskem said.

“This decision will result in the constitution of an accounting provision [with no cash impact] of approximately reais (R) 125m ($53m)."

Braskem describes itself as the leading company in the thermoplastic resins industry in Latin America and the third-largest resin producer in the Americas.

($1 = R2.39)

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By: Graeme Paterson
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