On its home terrain, the German company can produce MMA at Worms and Wesseling. It also has a facility in the state of Louisiana and one in China, along with downstream production of PMMA in Germany and Asia. In June, Röhm commissioned an expansion for impact-modified PMMA molding compounds in Worms, saying it was responding to high global demand” for the Plexiglas-branded transparent polymer.

Under a Memorandum of Understanding (MoU) signed last year, OQ Chemicals will integrate the Röhm plant into its production network and supply it with raw materials, utilities and site services. The facility, which will use Röhm’s proprietary LiMA (Leading in Methacrylates) technology, is slated to be mechanically complete by the first quarter of 2024.

An above-average volume of material changed hands across the PlasticsExchange trading platform last week, with a good balance between polyethylene (PE) and polypropylene (PP). Activity was spurred by an Arctic blast that brought frigid temperatures down through the United States and into Houston. Remembering the devastating deep freezes of February 2021, and to a lesser extent December 2022, petrochemical companies instituted precautionary protocols that affected monomer and resin production, but also helped to minimize severe weather-related damages, reports the PlasticsExchange in its Market Update.

While prime railcars have been available, processors are pushing back to procure railcars that start with a seven and they remain hopeful that they can hold out long enough to avoid high-volume purchases near peak pricing. Producers are keen to rebuild margins, but they entered January collectively with record inventories, so resin reactors are expected to throttle back even more, according to the PlasticsExchange. As such, a hefty flow of rougher off grade and transitional railcars are showing up, and these have been priced with a generous discount from prime. PP contracts probably will move higher in lock-step with the increase in PGP contracts, which is currently trending toward $0.04 to 0.05/lb.

Although producers entered 2024 with more than ample inventories of PE and PP resin, stronger market conditions have emboldened PE producers to implement a $0.05/lb increase for January contracts. Fresh nickel nominations for February are starting to percolate, as well. The Houston freeze exacerbated the polymer-grade propylene (PGP) shortage, and spot monomer prices advanced another $0.025/lb, setting up for an imminent cost-push PP increase currently targeting $0.04 to 0.05/lb, according to the PlasticsExchange.

Commenting on the investment decision, Oliver Borgmeier, CEO of OQ Chemicals, said, “both companies will greatly benefit from our future cooperation and combined expertise.”  Ron Ayles, managing partner at Advent International, Röhm’s private equity owner, added that “LiMA will strengthen the company’s position in the MMA market.”

The export market remained hot, as shipping disruptions in both the Red Sea and Panama Canal have displaced supply from intended demand, while ocean freight rates have been spiraling higher, supporting regional resin markets. A flurry of international resin requests flowed in for incremental/substitute resin from the United States, but price expectations need to adjust higher to grab the attention of US suppliers. Several US producers have already sold out their January export allotments, although they could be enticed to release more given the right incentives, said the PlasticsExchange.

With the realization of the new plant, Röhm CEO Michael Peck said the MMA and PMMA producer will complete the technology platform within its global integrated production system, guaranteeing its customers “the highest level of supply security.”

As Oxea, OQ Chemicals was once owned by Advent, which sold the company to Oman Oil for just over €2.1 billion in 2013. The name change took place in 2020 when the sultanate of Oman merged nine petrochemical producers under the OQ umbrella. Persistent rumors say the Gulf conglomerate is planning to divest the German company.

On signing the MoU for what OQ calls Propel, short for Propyls Elevated, and Röhm designates as the LiMa project, start-up was penciled in for 2023. The companies said at the time that 70 direct jobs would be created in the US Gulf region.

PP trading stayed healthy throughout the week. Prime PP prices moved another cent higher at the PlasticsExchange amid ongoing propane dehydrogenation (PDH) unit  outages alongside a fresh PP force majeure from Ineos, but resin demand has been soft.

PE market activity continued to ramp up past mid-month. Transactions were focused on high-density PE Blow Mold and Injection as well as linear-low-density PE Film grades. The vast majority of PE plants skated through the Houston freeze without a notable impact. Most of the prime PE grades at the PlasticsExchange picked up another half-penny and sit one to two cents higher so far this year. A steady flow of off-grade railcars rolled through, some at a meaningful discount. PE producers have been disciplined with their Prime railcar offerings into the spot market to encourage contract purchases as they push for a January increase. At least one producer has proposed another $0.05/lb price increase for February, and others are expected to follow suit after this past week’s weather event.

The Informa Markets Engineering network of B2B media sites includes Design News, Battery Technology, Medical Device & Diagnostic Industry (MD+DI), Packaging Digest, PlasticsToday, and Powder & Bulk Solids.

The Chocolate Bayou Petrochemical complex in Alvin, TX, has an annual polypropylene production capacity of around one billion pounds.

27.07.2022 - Germany-based OQ Chemicals, the former Oxea, has made a final investment decision to add capacity for propionic aldehyde and production infrastructure to support a new 250,000 t/y methyl methacrylate (MMA) plant being built by German acrylics specialist Röhm at OQ’s US site in Bay City, Texas.

The port of Houston was temporarily shut, backing up shipments. A number of plants experienced seemingly minor equipment issues and production outages. One force majeure did emerge on Jan. 18, declared by Ineos on its PP resin produced at the huge Chocolate Bayou Petrochemical complex in Alvin, TX. This came in response to mechanical failures, but Ineos did not provide any details on the nature or extent of the issues, according to ChemAnalyst. “This recent development follows a prior incident on January 14, where Ineos took measures to reduce the load on olefin production at the Chocolate Bayou site. The decision was prompted by cold weather conditions prevailing in the region, illustrating the vulnerability of industrial operations to climatic fluctuations,” reports ChemAnalyst. The plant makes ethylene and propylene and has an annual PP production capacity of around one billion pounds.

As has been seen in other cost-push increase markets, it has been a challenge for PP prices to keep up with rising PGP costs. Spot PP levels at the PlasticsExchange have risen three cents so far in January, while spot monomer has run up about eight cents, so there has been some margin compression.

PE exports remained strong, but will likely fall short of the record tally seen in December, especially since the weather forced the closure of packaging warehouses and the port, and the coming Lunar New Year, which begins on Feb. 10.