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Formosa Plastics declares force majeure on some US PE grades

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Formosa Plastics declares force majeure on some US PE grades

Houston — Formosa Plastics USA on Wednesday issued a force majeure declaration onshipment of some grades of polyethylene due to an unplanned shutdown of anolefins unit in late December and a subsequently extended recovery period,according to a company letter.

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The force majeure declaration applies to high density high molecularweight film and linear low-density polyethylene products, according to aletter to customers obtained by S&P Global Platts.

"We are currently evaluating the impact of this event on our productioncapacity and will provide additional information once we have assessed ourability to supply" such materials, the company said in the letter.

Formosa produces 939,000 mt/year of HDPE resin and 265,000 mt/year ofLLDPE resin at its Point Comfort, Texas site.

Formosa Plastics shut its 681,000 mt/year Olefins No. 1 steam cracker atPoint Comfort after a fire in the second half of December, according to afiling with state regulators.

Formosa said in the letter Wednesday it anticipates the unit will restartduring the second half of February. Sources earlier this week said Formosawould attempt to restart the unit in mid-February.

The availability of ethylene derivatives polyethylene and PVC has beenheard to be limited so far this month in the US, with a company source sayingFormosa would not be exporting PVC in February.

--Chris Ferrell, christopher.ferrell@spglobal.com

--Edited by Keiron Greenhalgh, keiron.greenhalgh@spglobal.com