MEXICO CITY (ICIS)--The March explosion at a factory in China that makes key intermediates for the textile dye industry has already had a huge impact on the market there, but talk this week at a conference in Mexico also found predictions of major ramifications in the global market.
“It will undoubtedly affect the global pigment and dye industry in a huge way,” said an industry source on the sidelines of PLASTIMAGEN MEXICO 2019.
A US polymer executive also at the conference said force majeures most likely will be declared and that he has been warning customers to expect delays and higher prices.
There was also talk that Milliken, a US-based company that makes coatings, colourants and specialty chemicals, has been affected by the explosion.
A Milliken employee at the Mexico conference would not comment on the explosion and referred calls to corporate headquarters. Milliken did not return calls and emails in time for this story.
The explosion on 21 March, at the Tianjiayi Chemical Plant in Yancheng, jolted the global pigments and dye market because the factory was heard to produce a few dozen key intermediates for the textile dye industry, including an estimated 10% of the world’s supply of m-phenylenediamine.
The day after the explosion brought an immediate run-up in stocks of major dye producers in China, their stocks soaring on expectations that dye prices would spike because of tightened supply of a chemical compound.
Since then, the Chinese government has launched stringent safety inspections that have brought a wave of shutdowns and production cuts.
And in late March, the CEO of US chemicals major Huntsman said the China explosion should lead to the country's regulators strengthening the enforcement of existing health and safety rules.