[Plastic] After experiencing extreme weather, the price of polyolefins in the United States soared

The petrochemical industry in the United States continued to be affected by the Texas winter storm last month.

Wood Mackenzie analyzed that the operation of petrochemical facilities on the U.

Therefore, the analyst firm said that for most of the first half of 2021, supported by the potential demand related to the re-emergence of the coronavirus, prices are expected to continue to rise.

More than 80% of the olefin production capacity in the United States went offline immediately after the impact of extreme weather peaked in mid-February.

Wood Mackenzie quoted Genscape's data showing that as of mid-March, the US olefin industry had not regained its footing, with only 60% of its production capacity resumed.

Several factories in the Houston and Corpus Christi metropolitan areas are still closed.

Wood Mackenzie said that although the supply of these important chemical materials declined during the power outage, the demand for their end-use products did not decline.

The price of polymer-grade propylene hit a historical high soon after the winter storm, but then fell and stabilized at a nearly three-year high.

Like the U.

Analysis shows that the operating rates of PE and PP in the United States fell by 33% and 36% respectively in February, which coincided with the strong domestic consumer demand in the first quarter of 2021, which led to a sharp decline in PE and PP inventory levels.

Initially, as winter storms hit the U.

All PX devices affected by the storm are either fully integrated into the refinery system or embedded in the refinery complex, many of which are closed or reduced due to weather.

Genscape said that as of mid-March, all refineries related to PX production in the United States have begun to step up operations on major processing facilities.

With the interruption of the main PX supply in the region, PX prices are expected to rise again in April.

The shutdown of US factories has also had a wide-ranging impact, even beyond the price and trade of the chemicals themselves.

Manufacturing supply chains in multiple industries are facing disruptions due to delays in the procurement of raw materials, which has affected packaging companies, which are struggling to find affordable supplies.

Wood Mackenzie expects that the tightness of the entire supply chain will continue, which will cause the prices of raw materials and end products to rise until the backlog of demand is relieved.

(Keyword: American polyolefin)