Force Majeure on MDI in Holland

On August 5, due to unforeseen circumstances beyond reasonable control resulting form the declaration of Force Majeure by several of Huntsman's Rotterdam cluster partners, Huntsman Holland BV declared force majeure for the supply of MDI and MDI-based products produced in Rotterdam, the Netherlands, effective immediately. Ethylene is a key raw material for the hydrochloric acid treatment in MDI facilities. However, due to force majeure on the supply of ethylene from local crackers, Huntsman MDI facilities were forced to shut down last week, then operated at reduced rates this week. The duration of this situation is uncertain at this time although they continue to work diligently to minimize the impact of this event and they will restore normal operations as quickly and as safely as possible once their partners’ issues have been resolved.

Shell Nederland

Shell is one of ethylene suppliers for Huntsman Netherlands. On July 26, Shell Nederland announced that in order to be able carry out repairs to one of the factories at the Shell Chemicals Park Moerdijk, this factory would be taken out of operation this weekend (around July 27) for safety reasons.

The factory closed by Shell Nederland mainly involves crackers, with a combined capacity of 900 ktpa of ethylene and 510 ktpa of propylene. Propylene is one of the main raw materials for polyether polyol. And major polyol suppliers in the Netherlands include Dow, Shell and Huntsman. Due to the force majeure on Shell’s propylene supply, local industry players are concerned that it may have an impact on local polyol production and supply stability.

Force Majeure, Trans-regional Allocation and Upcoming Maintenances Lead to Tightening MDI Supply in Europe

In Europe, apart from the Force Majeure mentioned above, BorsodChem MDI facility are undergoing maintenance from July 16. Dow’s MDI plants in Europe are still allocating their goods to their North American plant, whom was affected by the hurricane accurred in July, according to market sources. Additionally, Covestro MDI facility in Europe may have maintenance in this September/October. Taking into account, MDI supplies are tightening in Europe market.