US Flint Hills Resources declares FM, allocates sales of PP

02 October 2012 19:03  [Source: ICIS news]

HOUSTON (ICIS)--US polypropylene (PP) producer Flint Hills Resources is allocating sales of the resin out of its facility in Marysville, Michigan, a source confirmed on Tuesday.

The company declared force majeure on the supply of PP on 28 September, according to a customer letter obtained by ICIS. The force majeure was the result of a 26 September force majeure at an upstream provider of propylene and ethylene, according to the letter.

"We regret to inform you that the sole provider of propylene and ethylene, critical raw materials to Flint Hills Resources' Marysville, Michigan, polypropylene manufacturing facility suffered significant operational issues, requiring it to shut down operations and declare force majeure," the letter states. "As a result, FHR is declaring force majeure on the supply of polypropylene effective immediately and will be implementing a sales allocation to account for the loss of ability to maintain full delivery rates."

It was not clear what allocation levels had been set at or how long the force majeure would last.

The force majeure is just the latest in a series of supply interruptions in the PP sector. In recent weeks, at least two other PP producers, including LyondellBasell and Pinnacle Polymers, had declared force majeure on PP. It was not clear whether those declarations remained in place.

However, sources agreed supply in the PP market remains very tight.

By: Michelle Klump
+1 713 525 2653

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