PE supply problems continue in Mexico

Marianela Toledo

31-May-2016

HOUSTON (ICIS)–The persistence of limited supplies of some grades of polyethylene (PE) was said be concerning processing companies in Mexico, two different market participants said on Friday.  

Because supplies have been limited for months in the domestic market, inventories are low, one of the sources said, and it will take at least one month – if not two – for the situation to change.

According to another source, the low density PE (LDPE) plant at Ethylene XXI, which was expected to start operations by mid-May, was delayed because of problems with ethane supply.

Pemex supplies the ethane to the Ethylene XXI cracker.

Braskem-Idesa, which runs Ethylene XXI, did not immediately respond to a request for comment. 

Different sources said LDPE material could be seen in the market by July or August at the earliest.

In addition, supply from Mexico’s domestic PE producer, Pemex, continues to tighten.

Ethylene production was said to be operating at 60-70% capacity.

For Pemex, two out of four high-density PE (HDPE) reactors were said to be down. One to two out of three LDPE reactors were said to be working well. The swing plant was said to be operating near capacity.

Problems with PE production are related with domestic ethane supplies and other technical issues, a third market participant commented this week. 

All of Mexico’s crackers use ethane as a feedstock.

Braskem-Idesa started its first HDPE plant on 6 April, while the second HDPE plant started on 28 April.

It was said that operations started with HDPE injection grade and will be followed by blow moulding grade.

The site’s ethylene cracker started operations in March.

Ethylene XXI is a 75:25 joint venture between Brazil’s Braskem and Mexico’s Idesa. The project includes a 1.05m tonne/year ethane cracker, 750,000 tonne/year of HDPE capacity and a 300,000 tonne/year low density PE (LDPE) unit.

The Ethylene XXI complex is in Veracruz state, Mexico.

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