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Factbox: Formosa Plastics delays startup of Texas LDPE plant



New York —
Formosa Plastics USA has delayed the startup of its new 400,000 mt/year low density polyethylene plant in Texas to late July or early August, a spokesman confirmed on Friday.

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Spokesman Fred Neske said in an email that Formosa’s response to COVID-19 after some employees and contractors tested positive for the disease was a factor in this latest startup delay. The company sought to reduce the number of people at the company’s Point Comfort site and follow health protocols.

Sasol’s plant experienced a fire while undergoing commissioning in Janaury, and its startup was pushed to the second half of 2020. Spokeswoman Kim Cuismano said in an email on Friday that the company now expects the unit to reach beneficial operation — or 72 hours of continuous on-spec production – in the third quarter this year.

In Latin America, Colombia’s Esenttia will donate polypropylene for the making of 147,000 units of medical suits in Colombia. Brazil’s Abiplast expects production of manufactured plastics to fall 4.9% on the year to 5.9 million mt in 2020, and apparent consumption to fall 4.5% on the year to 6.3 million mt. Brazilian plastics converters are already seeing a fall in operating and sales rates of around 50% to 70%.

INFRASTRUCTURE

**DuPont is shutting down about 50% of its polymer capacity in preparation for downside risks going forward in automotive, aerospace, oil and gas and other industrial markets, CEO Ed Breen said on Tuesday.

**Formosa Plastics USA has delayed the startup of its new 400,000 mt/year low density polyethylene plant in Texas to late July or early August, in pat to reduce the number of workers at its Texas site per COVID-19 safety protocols, a spokesman confirmed on Friday.

**Sasol expects to start up its new 420,000 mt/year LDPE plant in Lake Charles, Louisiana, in the third quarter this year after completing repairs from a fire that damaged the unit in January, a spokeswoman said Friday.

**Westlake Chemical has reduced rates across its system, idled some non-integrated output and delayed a cracker turnaround to cut costs in response to economic shocks and lower demand for construction materials amid the global coronavirus pandemic, executives said on Monday.

**Shell Chemical on Monday began ramping up construction at its $6 billion petrochemical complex in Pennsylvania as 300 workers sent home in March when the company suspended work on COVID-19 concerns returned to the site to continue work on a co-generation plant.

**LyondellBasell has reduced rates across its system to accommodate lower demand amid pandemic-related shutdowns, with overall petrochemical and refining rates expected to operate in a range of 60% to 80% of nameplate capacity in the second quarter.

**Inter Pipeline hiked the cost of its propane dehydrogenation/polypropylene project in Alberta to $4 billion from $3.5 billion in part on costs stemming from the coronavirus pandemic, and startup could be pushed to early 2022 from late 2021, the company said this week.

**Enterprise Products Partners confirmed this week that construction is under way on its new 750,000 PDG unit at its Mont Belvieu, Texas, NGL hub, for which LyondellBasell is the anchor customer, with startup slated for Q2 2023.

**In Argentina, Dow informed its clients that polyethylene supply will not be disrupted following the stoppage at its HDPE plant between May and June, and will readjust production as needed.

PRICES


Olefins

**S&P Global Platts assessed spot polymer-grade propylene for front-month May at 21.25 cents/lb FD USG on Friday, flat on the day. The assessment was based on last known pricing indications amid no fresh activity. Forward-month June PGP was assessed at 21.5 cents/lb FD USG, flat on the day. The assessment kept Thursday’s market structure. Prompt spot refinery-grade propylene was assessed at 10.75 cents/lb FD USG, flat on the day. No fresh bids, offers, or trades were heard.

**US export MEG prices were flat on the week at 13.5-14.5 cents/lb FOB USG.

**S&P Global Platts assessed US spot butadiene at 13.75 cents/lb CIF USG Friday, flat on the week, based on last known pricing indications amid no fresh activity.

**S&P Global Platts assessed spot Mont Belvieu ethylene for front-month May at 10.5 cents/lb FD Mont Belvieu on Friday, flat on the day. The assessment came within a May ethylene bid-offer range at 9.5-12 cents/lb MtB-Nova. Forward-month June ethylene was assessed at 10.625 cents/lb FD Mont Belvieu, flat on the day. The assessment kept Thursday’s market structure.

**Choctaw ethylene for front-month May was assessed at 10.75 cents/lb FD Choctaw, flat on the day. The assessment took into account a May ethylene bid at 9 cents/lb Choctaw-Pipe. Forward-month June Choctaw ethylene was assessed at 10.875 cents/lb FD Choctaw, also flat on the day. The assessment took into account a June Choctaw/Nova ethylene flat offer.


Polymers

**Export LDPE prices were flat week on week Wednesday at $849-$871/mt (38.5-39.5 cents/lb) FAS Houston

**Export HDPE blowmolding rose $11 on the week Wednesday at $607-$629/mt (27.5-28.5 cents/lb) FAS Houston

**Export LLDPE butene prices increased $22 week on week Wednesday at $585-$607/mt (26.5-27.5 cents/lb) FAS Houston

**Export homopolymer PP prices was assessed up $22 on the week to $827-$849/mt (37.5-38.5 cents/lb) FAS Houston

**US export PVC prices rose $45/mt this week to $565/nt FAS Houston, while domestic PVC prices fell 5 cents/lb to 50 cents/lb delivered.

**US export EDC prices held steady at $60-$70/mt FOB USG.

**US import polyethylene terephthalate prices were assessed unchanged on the week Wednesday at $846-$868/ mt (38-39 cents/ lb), based on market talk of stable import pricing and last received indication of value in between 37-39 cents/lb.

**FOB LA curbside material was assessed flat on the day at 9 cents/lb, based on the last bid received at that level. In the Chicago market, PET post-consumer bales sourced from curbside collection were also unchanged at 8 cents/lb, based on last indication received at 8-9 cents/lb and market talk of value in the range of 6-10 cents/lb.

**Polymer prices in the Mercosur region, and the domestic markets of Argentina and Mexico reached a historical low on Wednesday.

**The domestic market of Colombia saw prices remain at a record low for all HDPE grades and for LLDPE.

**Brazil CFR: all prices were unchanged on the week, and HDPE film, blowmolding, injection and LLDPE were again at the lowest level. Brazilian polypropylene prices were flat, assessed again at a historical record low for homopolymer and copolymer.

**Polyvinyl chloride prices were also unchanged week on week and continued to be at the lowest level since Platts started the assessments in 2010 for the WCSA and 2011 for Brazil.


Aromatics

**US spot MTBE was 2.08 cents/gal higher at 78.02 cents/gal FOB USG on Friday, assuming an unchanged discount of 17.20 cents/gal to front-month NYMEX RBOB futures.

**Front-month (May) spot methanol was unchanged at 57 cents/gal FOB USG on Friday, with no new bids, trades, or offers heard in the market. Second-month (June) spot methanol was also unchanged at 58.50 cents/gal FOB USG, staying at a 1.50 cent/gal premium to the front-month value.

**Front-month (May) IPA was assessed down $50/mt at $2,650/mt FOB USG and $2,610/mt DER.

**US industrial ethanol was assessed 15 cents/gal weaker on Tuesday at 295 cents/gal FOB USG DSP for 190 proof and 320 cents/gal FOB DSP for 200 proof, based on downward movement in the US IPA market.

**S&P Global Platts assessed US ETAC $5/mt lower at $555/mt FOB USG and $605/mt DER in line with weaker acetic acid prices. Butyl actetate, meanwhile, was assessed $10/mt lower at $475/mt FOB USG and $525/mt DER, based on weaker n-butanol prices.

**US export caustic soda prices were flat at a 14-month high of $355-$365/mt FOB USG.

TRADE FLOWS

**US PVC exports fell 10.5% in the first three months of 2020 to 691,399 mt compared to the same period last year as lockdowns in China and India reduced flows, US International Trade Commission data showed this week.

**US MEG exports in the first three months of 2020 nearly tripled year over year to 511,429 mt and came close to 569,986 for all of 2018, reflecting last year’s sharp increase in output with new startups, according to the latest export data from the US International Trade Commission.



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