UpdateLyondellBasell to cut Wesseling PP by 24% on poor outlook

01 December 2009 12:09  [Source: ICIS news]

By Nigel Davis

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LONDON (ICIS news)--LyondellBasell will shut down a polypropylene (PP) line at its site in Wesseling, Germany, by the end of the year as it is no longer economically viable, it said on Tuesday.

PP capacity at the facility will be reduced by 110,000 tonnes/year, a cut of around 24%, according to figures on the ICIS plants and projects database. LyondellBasell says it has 460,000 tonnes/year of PP capacity currently available at the site.

“We have concluded that our current polypropylene operating rate at Wesseling is no longer economically viable,” said Anton de Vries, LyondellBasell’s president of Europe, Asia & International.

The company said the general business outlook for PP in Europe was very poor given the significant increase in production capacities.

“The affected line in Wesseling is one of the smallest and oldest PP units we have in LyondellBasell. We continue to invest in state-of-the-art facilities,” he added.

The planned capacity reduction would help the company optimise the set-up of its European PP manufacturing, a LyondellBasell spokesman added.

The closure comes at a time when the European market is in good balance due largely to production cutbacks.

PP demand, however, continues to be affected by the global economic crisis although LyondellBasell said it had seen some signs of improvement during the current quarter. These are, however, expected to be outweighed by increasing imports from the Middle East.

New production capacities in the Middle East and India are expected to have a significant impact on the market but there have, thus far, been only some reports of imported material.

Lyondell Basell’s total global PP capacity, including joint ventures is 8.5m tonnes.

PP producers in Europe include LyondellBasell, Borealis, SABIC, Total Petrochemicals, Dow Chemical, Repsol, INEOS Olefins and Polymers, Polychim and Domo.

For more on polypropylene visit ICIS chemical intelligence 
For more on Lyondellbasell visit ICIS company intelligence
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By: Nigel Davis
+44 20 8652 3214

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