Ineos 5 Factories Declared Force Majeure

According to theplasticsexchange, at least two North American Tier 1 railroad companies said they would implement traffic distribution controls due to domestic rail congestion. Affected by this, at least one major polyolefin producer has said it will issue force majeure on all its rail transported products, and it is foreseeable that the demand for North American trucking in the petrochemical industry may surge in the near future.

Earlier this week, Ineos Olefins & Polymers said in a letter to customers that it experienced force majeure on all of its polyolefin products related to rail restrictions and expected to be required to limit rail transport to its best average daily rate. the following. Ineos added that it was committed to exploring all commercially reasonable alternatives to deliver products to its customers, but that the company's deliveries would be greatly affected if restrictions worsen or extend beyond a few weeks. The force majeure polyolefin products include a 318,000-ton/year high-density polyethylene (HDPE) unit at Cedar Bayou, Texas; a 439,000-ton/year polypropylene (PP) unit at Chocolate Bayou, Texas. ) unit; 794,000 t/y high-density polyethylene (HDPE) unit at plant in Deer Park, Texas; 147,000 t/y polypropylene (PP) unit at Deer Park, Texas plant; California 230,000-ton/year polystyrene (PS) plant in Carson, Calif.

In addition, Ineos Olefins & Polymers has not resumed operations at its Carson, Calif., PP plant earlier this month due to a power outage and manufacturing.

Another major North American resin producer based in the U.S. Gulf also notified distributors and customers that its outbound railcar shipments had been disrupted and its daily outbound shipments were limited by the railroads it served.

The pressure on rail congestion led directly to a major logistics provider serving the petrochemical and resin industries this week announcing a rolling stock surcharge. Texas-based Quantix said in a letter to customers that it would apply a one-time $175 per railcar rail congestion surcharge to all railcars arriving at its terminals on or after May 1. The company added that rail congestion has pushed its domestic facilities beyond their design capacity, and that increased inventories and congestion are increasing its labor, fuel and switching costs as it struggles to explore storage alternatives. Tight supply chains have also led to a surge in demand in the auto transportation industry, but auto transportation labor and diesel costs are also currently high, and North American oil prices are currently above $5/gallon and are expected to increase further. Quantix added that the surcharge will only be removed when the shipping market stabilizes, diesel costs fall and product flows smoothly.

According to the latest data from the Association of American Railroads (AAR) for the week ended April 9, North American chemical railroad car loadings rose 3.5% year over year. Railcar loadings also increased by 5.2% year-on-year to 660,455 units.