07 November 2012 15:14 [Source: ICIS news]
(Adds context, paragraph six)
LONDON (ICIS)--South Africa's polyolefin producer Safripol declared force majeure on its supply of high density polyethylene (HDPE) and polyproplyene (PP) from 6 November, the company said in a letter to its customers, communicated to ICIS on Wednesday.
Safripol said it experienced a "production interruption at our site in Sasolburg in the form of the destruction of a power sub-station" on Monday 5 November.
In the letter to its customers dated 6 November, Safripol said: "This has resulted in an outage at both our HDPE and PP facilites. At this point in time we are unable to comment on the extent of the outage."
"This leaves us no alternative but to declare a force majeure event." The company added that "supply disruption will occur" and it will communicate the extent of the shortage separately.
The producer could not be reached immediately for an update.
In a letter dated 7 November, Safripol said it is "assuming" that its operations will resume over the weekend. The letter was sent to a regular buyer of Safripol's PP.
Safripol’s announcement has come at a time when most South African importers are short on HDPE.
However, any potential price increase is dependent on the extent and duration of Safripol's supply disruption, and the direction of demand, industry sources said.
October to December is the peak summer season in South Africa, but markets have been comparatively quiet this year on economic concerns fuelled by ongoing political strife.
Safripol is the sole HDPE producer in South Africa. However, PP supply is ample from the second local producer Sasol.
Safripol's PP grades include impact copolymers, random copolymers and homopolymers for injection moulding, extrusion, blow moulding, thermoforming and fibres.
Safripol HDPE producers carbon-black-filled pipe grades and natural grades for other applications including blow moulding, injection moulding and extrusion.
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