US Dow closes PC plant in Texas, to demolish it within year

Focus story by Tracy Dang

HOUSTON (ICIS)–Dow Chemical has ended polycarbonate (PC) production at its Freeport site in Texas, a company spokesperson confirmed on Tuesday, and demolition of the plant will take place within the next year.

“The Freeport polycarbonate plant has come to a complete stop,” said Jamie Ellis, a spokesperson for Dow‘s operations in North America. “No plans for the site has been announced.”

The site had a capacity of 105,000 tonnes/year, and major supplier Styron had sourced PC from the plant to commercialise it as natural PC, as well as use it in the production of PC compounds and blends.

In May, a source at Styron said that weakening demand for some grades of PC, unfavourable market conditions and squeezed margins had prompted the company to exit the North American commodity PC market, which includes grades for optical media, sheet and film, as well as some grades for injection moulding, extrusion moulding and compounding.

The source said that Styron would terminate its contract with Dow in the second half of the year, which would result in the closure of the Freeport plant.

Meanwhile, Styron would focus its North American PC business on the high-performance plastics segment.

“We will now change our sourcing strategy for PC to ensure continuing to supply of higher quality polycarbonate compounds and blends for specialty market applications like automotive, medical devices, electrical, lighting and consumer electronics,” the company source said.

Aside from the initial reaction, in which some Asian PC suppliers attempted to raise prices, US PC market participants said that Styron’s exit from the North American commodity business and Dow’s closure of the 105,000/year plant have had little impact on the market.

“The PC capacity is still very high, despite the closure of the Dow’s plant,” a distributor said. “The only entity affected seems to be Styron as they seem to be struggling to get back up to speed on the generic PC market.”

Additionally, Styron would still sell some grades of PC, compounds and blends by sourcing product from its operations in Europe and through other North American producers and suppliers.

“I do not think Styron closing the plant has any effect on the market other than people that had to requalify another resins for regulatory reasons,” a compounder said.

In the meantime, Styron remains optimistic about its decision to restructure its North American PC business.

“We still have competitive operations,” the company source said. “We see [PC] demand at a good level, and we will continue to focus on performance plastics and higher-end products up to modifiers, where we’re growing at those types of businesses.”

Styron also produces other plastic resins such as acrylonitrile-butadiene-styrene (ABS), engineered polypropylene (PP), polystyrene (PS), as well as styrene acrylonitrile (SAN). In addition, the company produces a broad range of latex and synthetic rubber products.

Formerly a part of Dow until 2010, Styron previously announced plans to change the name of all of its affiliated companies to Trinseo. While some have completed the name change process, others will continue to operate as Styron until their respective name changes are completed.

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