Arkema declares force majeure on France PVC

16 September 2010 11:44  [Source: ICIS news]

LONDON (ICIS)--Arkema has declared force majeure on polyvinyl chloride (PVC) from all four of its French sites due to restricted feedstock supply, a company source said on Thursday.

The company first declared force majeure on deliveries from its Berre, France, plant on Monday, following a disruption to its upstream vinyl chloride monomer (VCM) supply. Another declaration covering its French sites at Balan, St Fons and St Auban followed on Wednesday.

“We are evaluating when we can come back to normal,” said an Arkema source. “That’s something we have to check.”

The problem began with “unforeseen events” connected to VCM production that forced reduced capacity in downstream PVC. Because the VCM market in Europe is currently tight, with little product available on the merchant market, it would be difficult for the company to quickly secure VCM supplies from an outside source.

The company source said the declaration was made to protect supply for regular contract customers and to ensure that there were no major delivery delays.

“The deliveries will be less, but there will be no disruptions,” the Arkema source said.

The declaration is the third over the past four months in the PVC market, following those from Vestolit in Germany earlier in September and Poland’s Anwil in June. Both remained in place as of Thursday.

It also comes as demand in Europe is beginning to pick up, and European PVC suppliers are pressing for increases to September contracts ranging from €30-50/tonne ($39-65/tonne).

In August, domestic PVC prices settled at €1,045-1,070/tonne FD France and €1,050-1,070/tonne FD Germany.

Other PVC producers in Europe include LVM, INEOS ChlorVinyl, Shin-Etsu and Vinnolit.

($1 = €0.77)

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By: Libby George
+44 208 652 3214

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