06 September 2013 05:42 [Source: ICIS news]
Correction: In the story headlined “Thailand’s SCG to cut PE, PP output in Nov on tight feedstock” dated 6 September 2013, please read in paragraph 8…” SCG has four high density polyethylene (HDPE) plants…” instead of… “SCG has three high density polyethylene (HDPE) plants…”. A corrected story follows.
SINGAPORE (ICIS)--Siam Cement Group (SCG) plans to cut production at its polyethylene (PE) and polypropylene (PP) plants at Map Ta Phut, Thailand, in November because of feedstock constraints, industry sources said on Friday.
“SCG will have to cut production rates in November because it will experience tighter feedstock supply when Map Ta Phut Olefins shut its cracker for turnaround,” said a source close to the company.
“Its ethylene feedstock supply has already been affected after PTT Global Chemical reduced cracker operating rates in August,” the source added.
SCG has been running its PE and PP plants at full capacity despite its tighter ethylene supply because it still has enough feedstock in storage, the source said.
The extent of production cuts at its PE and PP plants in November is unclear now because it would be determined by the volume of feedstock supply SCG can obtain from the spot market, according to the source.
“The producer will have to stop the PE and PP plants if it cannot find ethylene and propylene spot cargoes before its feedstock stocks run out,” he said.
The uncertainty over SCG’s PE and PP supply in November has frustrated its local distributors, said a resin distributor in Thailand.
SCG has four high density polyethylene (HDPE) plants with a combined capacity of 980,000 tonnes/year as well as three PP units with a total capacity of 720,000 tonnes/year at Map Ta Phut, the source close to the producer said.
It also operates a 100,000 tonne/year low density PE (LDPE) unit and a 120,000 tonne/year linear LDPE plant at the same site, he said.
Thailand is a net exporter of LDPE, HDPE and PP with its volumes moving mainly to China and southeast Asia, he added.
SCG was not immediately available for comment.
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