Brazil's Braskem is increasing resin imports to the US in Hurricane Harvey's aftermath, a move aimed at helping fill any supply gaps as Texas Coast plants shut for the storm work to restart, Braskem America CEO Mark Nikolich said Friday.
Between the company's plants in Brazil and Mexico, Braskem can use its inventory and supply chain to help replenish US stocks in the short term, Nikolich said in an interview.
"We have been importing ratably from Brazil for over two years now," he said. "This is just continuity of those operations. We can rely on those assets to support us in a larger way."
Braskem Idesa, the company's joint-venture complex in Mexico, also has temporarily reduced the amount of polyethylene made available to the spot market to ensure its domestic Mexican customers and those with contracts for exports get the supply they need until US producers that idled operations for Harvey fully restart, he said.
Nikolich said the primary focus for Braskem-Idesa, which has a 1 million mt/year cracker and more than 1 million mt/year of polyethylene capacity, is supplying local markets as well as clients in the US, Canada and Europe.
The company has already been ratably supplying those contract export markets, "and now that supply chain is being asked to do a little bit more," he said.
Of Braskem's US plants, its facilities in La Porte, Texas, along the Houston Ship Channel, remained operational through Harvey's assault. Those facilities include a 354,000 mt/year polypropylene plant and the company's ultra-high molecular weight polyethylene, or UTEC, plant.
Braskem shut its 227,000 mt/year polypropylene plant in Seadrift, Texas, ahead of Harvey's initial landfall on August 25 as a Category 4 hurricane. Braskem also shut its 336,000 mt/year PP plant about 114 miles east of Seadrift in Freeport shortly thereafter.
Nikolich said the Freeport plant restarted earlier this week as access to feedstock and rail service was restored post-Harvey, and was running at full capacity on Friday.
The Seadrift plant was on "hot standby," meaning systems were on and ready to begin producing, on Friday as Braskem awaited full restoration of necessary third-party utilities and infrastructure, Nikolich said. Seadrift is about is about 49 miles northeast of where Harvey first came ashore. While the area did not sustain the kind of catastrophic flooding that engulfed the Houston area and far-Southeast Texas, it did sustain more wind damage, he noted.
Texas Coast shutdowns peaked with about 60% of ethylene capacity offline and roughly a third of polyethylene output idled. Railroads, critical to moving plastic pellets to packaging companies for transport, also shut much of their Texas Coast operations and ports from Corpus Christi to far-Southeast Texas were shut for up to a week or more.
However, Union Pacific and BNSF Railway have told customers this week that they restored much of their affected networks this week, with some areas still shut down for repairs and damage assessments. Packaging companies along the Houston Ship Channel are largely back at work with pellets incoming and trucks back on the road to load up cargoes. All the ports have reopened with various draft limits.
Some petrochemical plants remain shut while others have restarted or were in various stages of restart as lost power is restored and logistics operations resume.
ExxonMobil's Baytown chemical complex with cracker capacity of 1.2 million mt/year was operating at reduced rates, but Chevron Phillips Chemical and Shell on Friday were still assessing crackers and other units at 1 million mt/year Cedar Bayou and 836,000 mt/year Deer Park, respectively, on Friday. Ineos restarted its Chocolate Bayou crackers with a cumulative capacity of 1.8 million mt/year earlier this week.
