Brazil’s floods-hit state plastics sector under ‘hypothesis’ operations could normalize end May – trade group

Plastics producers in Rio Grande do Sul remain shut following the floods but are working under the “hypothesis” operations could normalize by the end of May, a full month after the floods hit the Brazilian state, trade group Abiplast said.

As such, they have made calculations for losses in revenue during a month, since 29 April when the floods started until the end of May.

According to the trade group, the estimated impact on plastics producers in the state could come up to Brazilian reais (R) 680 million ($132 million), or an estimated daily impact of R$23 million since the floods started on 29 April.

Rio Grande do Sul and its petrochemicals hub in Triunfo, near the city of Porto Alegre, is home to 40% of Brazil’s polyethylene (PE) and polypropylene (PP) production capacities.

Despite the end of May hypothesis, a spokesperson for the trade group conceded that as things stand – with hundreds of roads still blocked and workers unable to turn up for duty – to set a date for restart of operations would be premature, however.

Several petrochemicals companies based at the Triunfo production hub, near the state’s largest city of Porto Alegre, declared force majeure last week, including Brazil’s polymers major Braskem, Innova and Arlanxeo.