MDI Supply Tightens in Europe Amid Force Majeure and Regional Allocation

Huntsman Holland BV declared force majeure for MDI and MDI-based products from its Rotterdam facility due to unforeseen circumstances caused by force majeure declarations from several Rotterdam cluster partners. The supply disruption stems from a shortage of ethylene, a critical raw material for hydrochloric acid treatment in MDI production. Local ethylene suppliers faced force majeure, leading to shutdowns at Huntsman's MDI facilities last week and reduced operations this week. The duration of the disruption is currently uncertain, but Huntsman is working to minimize the impact and aims to restore normal operations as quickly and safely as possible once the issues with their partners are resolved.

Shell Nederland announced a shutdown of its ethylene crackers at Shell Chemicals Park Moerdijk, starting around July 27, for safety repairs. This facility, which has a combined capacity of 900 ktpa ethylene and 510 ktpa propylene, is crucial for polyether polyol production. With Shell being a key ethylene supplier for Huntsman Netherlands, this shutdown raises concerns about potential disruptions in polyol production and supply stability.

In addition to this force majeure event, BorsodChem’s MDI facility has been under maintenance since July 16. Dow is reallocating MDI supplies to its North American plant, which was affected by a July hurricane, and Covestro’s MDI facility in Europe may also undergo maintenance in September/October. These factors are contributing to tightening MDI supplies across the European market.

Source: MarketWatch, Inc.