03 April 2013 23:00 [Source: ICIS news]
HOUSTON (ICIS)--US melamine producer Cornerstone Chemical will allocate sales of melamine out of its Waggaman, Louisiana, facility, sources said on Wednesday.
The company declared force majeure on the supply of melamine on 2 April, following a mechanical problem at the plant last week. The unit is back up and running now, but at reduced production levels, sources said.
Allocation levels for customers have not yet been announced, sources said.
The force majeure is serving to tighten supply in an already tight market, after melamine producer Southern Chemicals experienced recent production problems at its plant in Trinidad and Tobago. Those production problems were exacerbated by an emergency shutdown at the island's natural gas plant on 29 March, which resulted in a nationwide electrical black out.
While the power has been restored, it is not clear whether the melamine plant was back up to normal operational levels, sources said.
The supply tightness in the US melamine market is expected to be enough to help push through a 5 cent/lb ($110/tonne, €86/tonne) price increase for second-quarter contracts, sources said.
($1 = €0.78)
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