Breaking news! Multiple chemical giants have declared force majeure

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The supply-demand imbalance persists, and two PP plants declare force majeure. It is reported that Ineos Olefins & Polymers stated in a letter to its customers that following a power outage at its plant in Carson, California, which caused manufacturing disruptions, the company officially declared force majeure regarding its polypropylene products. The company also said it is working to restore production capacity to normal levels as quickly and safely as possible. The day before, LyondellBasell stated in a letter to its customers that due to mechanical gearbox failures beyond its control, its subsidiary Equistar declared a force majeure situation regarding certain grades of PP resin produced at its plant in Lake Charles, Louisiana. The company stated that equipment failures will affect its PP extrusion capacity and limit its ability to produce certain grades of PP. In 2021, LyondellBasell began implementing a quota-based allocation system for PP, and in April, customer allocations at LyondellBasell will also be determined based on the purchasing history of PP grades over the previous 6 months, up to February. Due to recovering demand downstream and tight supply, spot prices of polypropylene (PP) in the United States have once again reached their highest levels since the beginning of 2022; the prices for PP homopolymers and copolymers are 1.02 dollars per pound and 1.12 dollars per pound, respectively. ExxonMobil plans to shut down part of the capacity at its Singapore plant in April. On April 4, ExxonMobil stated in an official statement to its customers that due to unforeseen external market factors that have severely impacted the company’s operations, it plans to shut down part of the capacity at its Singapore plant in April. The company did not specify which units were affected by the production halt, but assured buyers of a stable supply of high-performance polyethylene (metallocene grade). Therefore, what can be confirmed for now is that the 650,000 tons per year metallocene PE (mPE) plant will remain in operation throughout April. However, existing plants, including a 480,000 tons per year PP production line and a 600,000 tons per year LLDPE plant, may be affected, as well as the new 650,000 tons per year LLDPE production line. Total North America announced a price increase for PP in May. Although the polypropylene (PP) contracts for April have not yet been finalized, the second-largest resin producer in North America has stated its intention to raise the profit margins on PP contracts for May, due to strong demand from processors and resellers, supply constraints, and rising prices for the raw material, polypropylene grade Propylene (PGP). In a letter to customers on Wednesday, TotalEnergies said it would raise the price of PP products by $0.06/lb.