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Home > Chemial News > Paint & Coating News > Dozens of chemical giants "collectively stop production"!

Dozens of chemical giants "collectively stop production"!

Echemi 2021-07-19

Recently, Sapref, the largest oil refinery in South Africa, announced that it had suspended production due to domestic protests and that the supply of all petroleum products was experiencing difficulties. The plant’s letter to its customers mentioned that “the company had to make a difficult decision to close the plant and declare force majeure. The route of entry and exit in Guazuluna province was disrupted. Sapref’s key raw material supplier informed that the transportation vehicles were affected. Delivery is suspended due to damage and staff safety concerns.” It is worth noting that this is not the first refinery in South Africa to suspend production. It is reported that on July 13 an oil refinery in Durban, South Africa also announced due to safety considerations. stop production.

According to foreign media reports, the only international company in the world that is currently engaged in large-scale coal liquefaction to produce synthetic fuels (SASOL) has declared force majeure.

Out of stock and production suspension, overseas chemical giants collectively encounter a "crisis"

According to the Coatings Purchasing Network, there are not a few chemical companies that have recently encountered force majeure and stopped work, stopped production or reduced production load, and delayed delivery. Most of them are leading companies and have a pivotal position in the industry. Their production procedures and the extension of the delivery period will undoubtedly have an impact on the product supply of the entire industrial chain.

Rantic: Due to heavy rains hitting the Novara factory in Italy, which caused a power outage, PA66 and its intermediate products produced by the factory, including HMD, adipic acid, nitric acid, and PA66-salt, have all declared force majeure.

The main supplier of BASF’s adiponitrile (ADN) informed that BASF’s force majeure continues and will not be able to provide BASF with the expected amount of adiponitrile (ADN). In the same period, the HMD, 2PN, Ah salt (PA66 salt), Ultramid A and AC PA66 products were also declared for force majeure. BASF predicts that the force majeure may exist for a longer period of time than previously anticipated, and the supply distribution is expected to be maintained until at least August.

SABIC: The LDPE installation in Limburg, the Netherlands caused force majeure due to technical problems. It is reported that the annual production capacity of the region is 570,000 tons of LDPE and 320,000 tons of HDPE.

TotalEnergis (Total Energy): Its EPS plant in Falluy, Belgium announced force majeure.

Shintech, the fourth largest PVC producer in the United States, announced force majeure in its PVC installations.

Due to the interruption of the signal controller of the Munich railway, force majeure appeared in the PVC production unit of Vinnolit, a large European PVC manufacturer.

The chemical giant Covestro announced that its 420,000-ton/year MDI device in Brunsbite, Germany, will become force majeure effective today. It is reported that the MDI device was shut down during the routine maintenance of the device during August-September. The reason for the shutdown was an unexpected failure of the production system. In addition, Covestro's annual output of 330,000 tons of MDI and other products, such as liquid caustic soda, Makroblend polycarbonate and hydrochloric acid (HCl), are still under force majeure.

The large German plastics manufacturer and multinational group VEKA (Vika) said in a letter to customers that due to the insufficient supply of PVC raw materials in the market, the company has announced force majeure for its products and has extended the company's product delivery time as a result.

Celanese, a global chemical and specialty materials company, announced that due to the surge in demand and the shortage of raw materials (such as the raw material adiponitrile for PA66), the supply of polyamides is in short supply. In addition, the global logistics market continues to face challenges, especially the shipping from Asia. Disrupted the normal supply of goods, eventually leading to delays in the delivery of finished products. Celanese said that it is impossible to avoid supply interruptions and restrict supply to customers, but will make every effort to reduce the disruption to customers' business.
According to industry insiders, in addition to more than a dozen chemical companies that have recently issued notices, announced the continued force majeure events, and extended the delivery period, the European and American regions encountered extreme cold weather before, and their equipment failed and were difficult to restart quickly. There are still many local chemical companies. Production has not yet officially resumed.


More than 20 chemical companies shut down production, shut down for maintenance, supply and demand imbalance, inventory crisis

With the advent of the second half of the year, many petrochemical and chemical companies such as Wanhua Chemical, Daqing Petrochemical, Qilu Petrochemical and other petrochemical and chemical companies have more frequent maintenance plans. The maintenance time is generally around 15-45 days, involving MDI, styrene, methanol, caprolactam, and PTA. For many other chemical raw materials, it can be said that "half of the country" of chemical raw materials products will usher in a shutdown for maintenance in the near future, and the market supply will further shrink.

Wanhua Chemical announced that the company's 1.1 million tons/year MDI plant in Yantai Industrial Park will be shut down for maintenance on July 10, and the maintenance is expected to be about 25 days.

Daqing Petrochemical's 225,000-ton/year styrene plant plans to shut down for 15 days on July 20;
Qilu Petrochemical’s 200,000-ton/year styrene plant was originally planned to be overhauled for 45 days on August 10, but it is now advanced to August 5;
North Huajin’s 177,000-ton/year styrene plant plans to shut down for maintenance on July 15 for one month;
Gulei Petrochemical’s 600,000-ton/year styrene plant was postponed to start-up at the end of July; the plant’s commissioning was postponed, and the output increased less than expected;
Liaotong Chemical's styrene plant plans to start overhauling for 35 days on July 15;
Jingmen Yingde Gas Co., Ltd.'s 500,000-ton/year methanol plant will shut down the entire system for maintenance from 8:00 on July 15th. The maintenance period is expected to be 15-20 days. During the maintenance period, the methanol sales will be suspended;
Shandong Rongxin's 250,000 tons/year coke oven gas methanol plant will be shut down for maintenance on July 12, and the planned period will be about 20-30 days;
The 500,000 tons/year methanol plant of Jingmen Yingde Gas Co., Ltd. is scheduled to shut down on July 15 for maintenance, and the estimated duration is about 15-20 days;
Shenhua’s 300,000-ton/year coke-oven gas-to-methanol plant was shut down on June 20 for maintenance, which is expected to last for one month.
A set of 200,000 tons/year staple fiber plant in Sanfangxiang is scheduled to be shut down for maintenance on July 20. The plant's total short fiber production capacity is 800,000 tons/year;
Shanxi Lubao's 100,000-ton/year caprolactam plant will be shut down for maintenance for one month on June 28, and it is planned to restart at the end of July;
The 200,000-ton/year caprolactam plant of Shanxi Yangquan Coal will be shut down for 40-50 days for maintenance on June 15 and is scheduled to restart in early August;
Jiangsu Haili’s 200,000-ton/ton caprolactam plant has a load of approximately 50% and will be shut down for maintenance for one month at the end of July;
Fuhai Chuang’s 4.5 million tons of PTA device load is 80%, and two lines are expected to be inspected from the end of July to the beginning of August;
The 1.2 million tons of PTA equipment of Ningbo Taihua will be shut down for maintenance on the evening of July 10, and the maintenance is expected to be around 18 days;
Yanshan Petrochemical's butyl rubber plant is scheduled to be overhauled until late July;
Panjin Xinhui butyl rubber plant plans to shut down for maintenance from July 15 to August 15;
Jingbo Zhong's polybutyl rubber plant plans to shut down for maintenance from September 20 to October 20;
Changchun Chemical's bisphenol A production line plans to shut down for 45 days in mid-September for maintenance;
The 150,000-ton/year phenol ketone plant of Jilin Petrochemical was shut down for maintenance on June 7. It is estimated that there will be no export sales for 45 days.

The frequent occurrence of force majeure by large foreign factories and the parking maintenance of many domestic chemical companies' products and installations in the near future have caused everyone to worry about it, and expressed their concerns about the future market trend of the chemical market. In addition, many places in northern China have encountered heavy rains recently. The State Defense Office required 13 provinces and cities including Beijing, Tianjin, Hebei, and Shanxi to enter a state of preparation for war. Some regions require that production must be stopped during heavy rains to ensure safety. This also means that nearly 10,000 chemical companies in more than a dozen provinces, cities and regions will face suspension of production at any time, which will further promote the decline in the operating rate of domestic chemical companies and the reduction in production load.

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