Mexico: PE supply to be tight as an ethylene cracker will be down

HOUSTON (ICIS)–Ethylene production at Mexico’s state-owned Pemex plant in La Cangrejera will shut down starting February 15 for 14 days for planned maintenance, a source familiar with the issue said on Tuesday.

“Plants of polyethylene and other derivatives will continue to operate with ethylene in inventory and from the Morelos plant,” the source said.

PE production will still likely be lower during the outage.

“The swing polyethylene plant will stop for 10 days, starting February 18,” the source said.

PEMEX PE Capacity

Pemex PE production problems began in September and continued through the end of November. At that time, all PE production was said to be down because of maintenance.  By December production returned to its usual, normal levels. However, production was on and off for a train producing LDPE at La Cangrejera.

Since then, inventories have remained low.  In addition, domestic demand increased as the Mexican Peso fell against the US dollar. Pemex is the only PE supplier selling in pesos. When the currency depreciates, buyers turn to the domestic producer to secure a fixed price for the resins.  

Indeed, US PE exports to Mexico increased last month as is shown in data released this week by the US International Trade Commission (ITC).