Braskem's Brazilian plants operate at 50% capacity on trucker strike

31 May 2018 16:57 Source:ICIS News

HOUSTON (ICIS)--Braskem's chemical plants in Brazil are operating at 50% capacity because of logistical disruptions caused by a recent trucker strike.

Braskem had been gradually reducing the utilisation rate of its central petrochemical plants in the country, it said in a filing on Thursday with the Sao Paulo Stock Exchange (Bovespa). As the nation's logistics return to normal, Braskem will bring operating rates back to normal, the company said.

Braskem is Brazil's largest petrochemical producer, and it is the country's sole producer of polyethylene (PE) and polypropylene (PP) in Brazil.

The Brazilian Truck Union called for the strike on 21 May, and it quickly spread to most of the nation's 26 states.

Brazil is especially dependent on its roads to ship products because its rail system is paltry.

The strike quickly paralysed the country.

Other chemical producers, such as AkzoNobel, BASF and Elekeiroz, also reported disruptions because of the strike.

Solvay Group's Rhodia said on Wednesday that some of its operations are being impacted by the truckers blockading of highways. It has informed customers and is "preparing to regulate recovery of some of its production units and delivery of products, so the transport situation is normalised".

ARLANXEO's plants are running according to the company's monthly production schedule, the company said on Wednesday. Some shipments could face delays because fewer trucks are available and because of leftover highway blockages from the strike.

ABCAM called for the strike to end on Monday.

However, tuckers have maintained some of the blockades that they erected on highways as part of their strike, Brazilian media reported. The publication O Globo reported that 197 such blockades remained at the margins of federal highways.

Just days after the truckers ended their strike, Brazilian refinery workers called for their own 72-hour strike that affected most of the country's refineries.

This strike is not expected to disrupt fuel supplies because of its limited nature.

Refineries are important to Brazil's petrochemical industry because it relies mostly on naphtha as a feedstock for its crackers. In addition, refineries produce aromatics and propylene, which can be used as feedstock.

Since most of Brazil's crackers use naphtha, it is less dependent on refineries for these intermediates than the US, where most of the crackers are gas-based.

By Al Greenwood