LyondellBasell calls force majeure on Polish polypropylene

19 May 2010 13:02  [Source: ICIS news]

PolypropyleneLONDON (ICIS news)--LyondellBasell has declared force majeure on polypropylene (PP) from its joint venture Basell Orlen Polyolefins (BOP) 400,000 tonne/year plant in Plock, Poland, market sources said on Wednesday.

In a statement, the company said that “as a result of unforeseeable technical production problems due to low polymerisation” in the Plock PP plant, it was unable to supply PP grades from Plock.

The company gave no time frame as to how long the restrictions would remain in place but assured customers that it was analysing the root causes of the situation to be able to restore normal supply as soon as possible.

This news came as a blow to some PP buyers who were already under force majeure restrictions from Total Petrochemicals.

“This has already impacted us,” said one buyer. “I was going to use material from this plant [Plock] to replace what I couldn’t get from Total.”

Upstream there was a tightening in propylene availability as BP Refining and Petrochemicals (BPRP) declared force majeure on propylene supplies from its PCK Schwedt, Germany, and Nerefco Rotterdam, Netherlands refineries.

Some sources in the monomer market were now expecting the June contract price to increase from its current level of €1,000/tonne ($1,219/tonne) FD (free delivered) NWE (northwest Europe).

PP buyers feared they would be faced with yet more increases in June, a month which many had hoped would see at least stability, if not price erosion.

“There will be more increases next month now,” said a major PP producer.

PP homopolymer injection prices were at €1,250/tonne FD NWE in May, on a net basis, up by over 30% since the beginning of 2010.

The Plock PP plant is owned jointly by Basell Europe Holdings B.V. and PKN Orlen S.A. Each of the partners has a 50% share.

($1 = €0.82)

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