The MDI market in North America has been tight for some time and the situation has worsened after Ida hit the Gulf and proceeded to move inland. Hurricane Ida swept into Louisiana at the end of August as a category 4 storm, causing widespread electrical power outages and disruptions to petrochemical production and transportation. A number of chemical plants closed before the arrival of Ida in order to minimise damage. BASF shut down production at its Geismar site on 28 August. The operator has MDI, TDI and polyether polyols plants at the site. On the 3 September, BASF declared force majeure on MDI due to lack of raw materials and infrastructure issues even though the MDI plant was reported to have minimal damage. Before Ida arrived, MDI was already tight due to a number of reasons. Supply disruptions plus external issues such as truck and vessels shortages. The tightness has been further amplified by a reduction of MDI imports into the US.
European supply was disrupted in July and August and the tight situation was reflected in the monthly price settlements which went up. Borsodchem started its planned maintenance in Kazincbarcika, Hungary in August. Covestro declared force majeure at its 200 ktpa MDI Brunsbuttel, Germany plant on 2 July. The force majeure remains in place. Inventory levels are still low and could lead to further purchasing before the end of the year and when the festive season begins. Supply was further disrupted by the bad weather in Germany, which led to severe flooding. As far as we are aware, damage to the chemical plants has been limited, though some power plants were knocked out for hours. MDI/TDI producers such as Covestro and BASF are based in the region and are expecting further delays of raw material deliveries due to this situation. On 27 July, there was an explosion and a fire at Chempark Leverkusen, Germany. There was one casualty and several people were injured. A number of operators have plants at the site including BASF and Covestro. Most operators declined to comment on operations but it is understood that power supply was restricted to the site.