Formosa Plastics USA lifts force majeure on chlor-alkali: letter

Formosa Plastics USA has lifted its force majeure on chlor-alkali products declared in May after torrential rain flooded its Texas 736,000/mt chlor-alkali facility, according to a customer letter seen June 22 by S&P Global Platts.

"We are pleased to announce that our chlor-alkali unit has fully recovered and Formosa is lifting the force majeure, effective immediately," the letter dated June 21 said.

The unit flooded May 18, prompting the May 19 force majeure declaration. Formosa had lifted April 26 a previous force majeure on chlor-alkali products declared the week of Feb. 15, when a deep freeze forced widespread petrochemical plant shutdowns in Texas and Louisiana.

Market sources said the lifting of the latest force majeure indicates Formosa has restored output and is producing chlorine to feed downstream polyvinyl chloride production. The company still needs to clear order backlogs before selling caustic soda into spot markets.

"It's still going to be tight catching up," said a source familiar with company operations.

Caustic soda, a byproduct of chlorine production, is a key feedstock for alumina, pulp and paper, soap and detergent.

Westlake Chemical also June 16 lifted a force majeure declared May 18 on membrane-grade caustic soda, according to a customer letter seen by Platts June 22. The company declared force majeure after a brine pipeline that serves its Geismar, Louisiana, complex burst, cutting off supply. The pipeline, operated by Boardwalk Pipeline, was repaired May 24.

However, Westlake has two other force majeure events on chlor-alkali products that remain in effect, which have contributed to tight US chlorine and caustic soda supply.

The company declared force majeure June 1 on chlorine manufactured and shipped from its 300,000 mt/year chlor-alkali facility in Natrium, West Virginia, after a sudden processing equipment failure, according to a customer letter seen by Platts.

Then Westlake declared force majeure June 9 on chlorine, hydrochloric acid, and caustic soda manufactured and shipped from its 75,000 mt/year Longview, Washington, facility, because of an unexpected electrical equipment failure, also according to a customer letter seen by Platts.