Katrina pushes leadtimes way out

Staff -- Purchasing, 10/6/2005

Leadtimes for 37 of 41 chemical, plastic resin and processed plastic and synthetic rubber products tracked monthly by PURCHASING magazine extended in September. The possibility of petrochemical market disruption along the Gulf Coast in an active hurricane season turned to reality at the August 28 arrival of Hurricane Katrina.

The Gulf of Mexico coast region is a major center of supply of crude oil and natural gas—commodities that are feedstocks and energy sources for the chemical process industry. The leadtime report fits with U.S. Federal Reserve data showing that industrial output rose a tiny 0.1% last month as Katrina depressed output at refineries and chemical plants in the region.

Leadtimes expanded across the board but the biggest one-month jumps—into the 20-week or more range—affected deliveries of such chemicals as LAS, phenol, carbon black, styrene, ethylene, mixed xylenes, titanium dioxide, dioctyl phthalate, sulfuric acid, sodium bicarbonate and soda ash. Resins most impacted were low-density polyethylene, high-density polyethylene, polypropylene, polystyrene and vinyl chloride monomer.