More containers still a need in US polymer supply chain – chem execs

HOUSTON (ICIS)–US polymer producers may work around the imposition of new tariffs from the US-China trade war, but finding enough shipping containers still remains one of their major logistical problems.

“Container shortages are still an issue,” said Bob Rhoades, general manager, global supply chain at Chevron Phillips Chemical (CP Chem).

Shipping containers are needed to export bagged PE.

Rhoades said that 25-30% of US PE production now is exported, and more than likely, that percentage will increase because of another wave of new US polymer capacity scheduled over the next few years.

Speaking on a panel at the Petrochemical Update Supply Chain and Logistics Conference in Houston, Rhoades said one way to solve the container shortage is more imports.

“Obviously we need the imports so we can use that container for an export,” Rhoades said.

Rhoades said new tariffs imposed because of the trade war have not been disruptive for CP Chem, though he added that the producer is not exporting PE to China right now from the US.

Rick Lisa, senior director of logistics management at Formosa Plastics, said one impact of the trade war is that nothing leaves the US for China.

“The front haul gets reduced because of tariffs,” Lisa said. However, Lisa said one likely outcome of the trade war is that not just polymer but many petrochemical trade flows are  changing.

“Trade flow changes, that’s going to happen, no matter what,” Lisa said. “The tariffs are just going to point the spigot in another direction.”

The Petrochemical Update conference at the Royal Sonesta Houston Galleria continues on Friday.

Click here to view related stories and content on the US-China trade war topic page.