European players face delays after rail closure in South Germany
German Chemicals Industry Association (VCI) said that approximately the half of raw material shipments to chemicals plants and products to their customers could be diverted via alternative rail routes, but the remainder would have to be transported by truck or ship.
Major chemical sites owned by BASF, Evonik, Covestro, Lanxess and Ineos are connected to this railway. Other global producers Dow Chemical, DuPont and LyondellBasell also have sites in Germany.
This news has already triggered woes about supply deliveries among market players and some suppliers have boosted their prices in the wake of disruptions.
A converter in the medical sector concluded a PVC deal in late August, paying €15/ton increases for West European material. The buyer said, “Our supplier has already applied a small increase on our prices, before waiting for September ethylene contracts and PVC prices, as they had some transportation issue in Germany.”
A buyer in Italy also confirmed that they expect delivery delays following the transportation issues related to the railway suspension. This might give an upper hand to the suppliers along with the expected lack of import flows following a number of shutdowns due to Hurricane Harvey.
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