BASF faces PS and EPS production issues, order cancellations at Ludwigshafen site

LONDON (ICIS)–BASF have had to undergo production cutbacks and either delay or cancel sizeable orders for general purpose polystyrene (GPPS) and expandable polystyrene (EPS) at its Ludwigshafen site amid persistent, historically low Rhine water levels severely affecting logistics, sources said on Monday.

BASF have declared force majeure for a number of products at the Ludwigshafen site last week because of the logistical complications related to the Rhine’s low level.

According to a company source, PS and EPS sales have also been impacted.

“As regards [to] GPPS and EPS, yes, orders have to be cancelled and/or postponed. Cannot comment on the amount but it is significant,” the source commented.

Last week, a company source said that production had to be reduced “for all styrenics” at the site.

According to a buyer, deliveries for PS in October were delayed by two or three days and November orders are on allocation.

Despite the production issues at BASF’s site, supply across other parts of Europe for PS and EPS have been broadly balanced, with demand stable to soft for the time of year.

Players in both markets in Europe expect substantial decreases for next month following an erosion in upstream styrene monomer spot values over the last two weeks, amid a similar drop in Asia.

With supply tightening amid production issues but upstream costs anticipated to fall, prices could diverge depending on area and whether demand is renewed following any significant dip in costs.

EPS is a rigid form of PS used in construction and packaging applications. GPPS is used in food packaging, disposable utensils, cutleries and various other consumer items.