Europe styrene braced for impact after Moerdijk explosion

Truong Mellor

04-Jun-2014

LONDON (ICIS)–Players in the European styrene market are braced for some potential impact on pricing and availability following the explosion at Shell’s joint venture styrene monomer (SM)/propylene oxide (PO) plant (MSPO-2) at Moerdijk in the Netherlands late on Tuesday, although many feel that this may not be felt immediately.

The blast happened at the reactor of the MSPO-2 installation at the Moerdijk production site.

The facility is owned by Ellba, a 50:50 joint venture between Shell Chemicals and German chemicals major BASF. It can produce 550,000 tonnes/year of SM and 250,000 tonnes/year of PO, according to Shell’s website.

European styrene spot numbers for June had been hovering within a range of $1,530-1,560/tonne earlier this week, with a deal done on Tuesday at $1,538/tonne and talk of a deal at $1,540/tonne.

Availability in the Amsterdam-Rotterdam-Antwerp (ARA) region has been healthy in recent weeks, owing to steady import volumes from the US as the Asian market falters amid weak demand and oversupply in the region.

While there has been talk that the Ellba unit was going into turnaround over the course of June, this was not confirmed by Shell.

So far this morning, one trader noted that there are bids for June at $1,540/tonne while offers were indicated as high as $1,600/tonne, although the trader felt these were too high.

“It’s business as usual for now,” the trader added. “People can still load barge from one unit at Moerdijk. The impact could happen later if the shutdown is extended, and some buyers will be affected.”

One source in the distribution market said: “It’s not a wise idea to buy spot if you don’t need it,” noting the incident at Shell’s Godorf site earlier this year, when a toluene storage tank explosion saw a declaration of force majeure, although the impact on the toluene market was minimal.

Shell declined to comment further on Wednesday morning following its initial statement on the incident.

Tom Brown and Stefan Naidu contributed to this article

READ MORE

Global News + ICIS Chemical Business (ICB)

See the full picture, with unlimited access to ICIS chemicals news across all markets and regions, plus ICB, the industry-leading magazine for the chemicals industry.

Contact us

Now, more than ever, dynamic insights are key to navigating complex, volatile commodity markets. Access to expert insights on the latest industry developments and tracking market changes are vital in making sustainable business decisions.

Want to learn about how we can work together to bring you actionable insight and support your business decisions?

Need Help?

Need Help?