Braskem sees major PP export opportunities from new US Delta plant – CEO

NEW YORK (ICIS)–Braskem sees the opportunity to export a substantial amount of the polypropylene (PP) produced from its new 450,000 tonne/year Delta plant in La Porte, Texas, US, the CEO of Braskem America said on Thursday.

“We’re designing the business plan for 50% or more to be supplied to Braskem affiliates in other parts of the world,” said Mark Nikolich, CEO of Braskem America.

“We’re working on the infrastructure required to do that efficiently… We’ve partnered with the Port of Charleston on that, and the capacity there is up to 450m lb (204,000 tonnes) of exports,” he added.

The design and development phase for the export hub is already under way and the facility is expected to be completed by Q3.

Braskem has PP production in the US and Brazil, as well as Europe, centred in the Netherlands.

Its Delta project in La Porte is expected to start up in Q3.

Braskem currently operates five PP plants in the US, in Texas, West Virginia and Pennsylvania, with a combined capacity of 1.59m tonnes/year, according to the ICIS Supply and Demand Database.

“We typically supply [exports] from our asset base – not from a single asset… What we’ll do is line load around our assets in the US to find the best efficiency for the exports. Exports will come from the plant with the best ability to make the product at the right cost at the right time for the export client,” said Nikolich.

EXPORTS TO CENTRAL EUROPE, WEST COAST OF SOUTH AMERICA
Braskem is targeting central Europe as well as the west coast of South America for PP exports from the US.

“We have very large operations in Brazil, so the advantage of the US supplying into South America is really in places where it is more challenging and more costly for [Brazil] to ship to. Shipping from Brazil to Chile and Peru is expensive and we can more efficiently supply those clients from North America,” said Nikolich.

“It’s really a way of optimising all three [production] regions,” he added.

OPPORTUNITY IN INDIA
Strategically, Braskem is also eyeing Asia markets for PP exports from the US.

“Braskem has been looking at Asia more critically for the last six years. We have an office in Singapore and recently opened one in Mumbai. Part of our strategy is: How do we more efficiently start participating in other markets? And clearly India specifically is something we have a lot of interest in,” said Nikolich.

“We have some commitments to export to Asia and my belief is that India is a good opportunity in the context of Asia, because they still have limited ability to produce within the country. A lot of these products are imported,” he added.

While some of Braskem’s PP may find its way to China, it’s not as strategic a market as India when it comes to the Delta project and expansion in North America, as China is well progressed in building out its propylene chain, the CEO pointed out.

Additional reporting by Zachary Moore

Interview article by Joseph Chang