Formosa Plastics USA Lifts Force Majeure on the PVC Facility
- 09-Jul-2021 11:00 AM
- Journalist: Harold Finch
On July 6th, 2021, Formosa Plastics announced to have lifted the force majeure (FM) on Poly Vinyl Chloride suspension-grade facility located at its Point Comfort, Texas complex. Upliftment of FMs signifies that the manufactures can now fulfill their contractual obligation and can further increase the material availability for exports. Force majeure came as a natural reaction when polar storm devasted the US Gulf Coast, which forms the major hub for PVC production. However, force majeure announced on specialty grade of PVC remains unaffected, as per the letter to the customers.
Formosa became the latest of manufacturers to lift force majeure after Westlake lifted its FM on PVC on June 1st while OxyChem followed suit lifted FM on June 28th, 2021.
In other events, the startup of Formosa Plastics USA's expansion of its 513 KTPA Poly Vinyl Chloride plant in Baton Rouge, Louisiana has been delayed to Q4 2022 from earlier Q4 2021. According to company documents, Formosa is looking to debottleneck production at the Baton Rouge plant by adding 130 KTPA of capacity.
These events point towards the improving PVC market dynamics in USA and may come as light at the end of the tunnel for PVC although as per market participants PVC supply remains tight.