US chemical shipments to Latin America still delayed from early Oct ILA strike: market

One month after the three-day International Longshoreman Association port strike in the US, South America-based chemical commodity traders said Nov. 5 that chemical markets were still seeing logistics issues, with US-origin product shipments delayed and customers requesting to cancel purchases while waiting for prices to drop.

PVC, polyethylene and propylene shipments to Brazil are among those affected by the strike, which lasted from Oct. 1-3, sources said.

“The shipping situation from the US has turned into chaos,” a local trader said. “The scenario for shipping from the US for any material is very bad.”

The same source said the logistical issues have impacted purchases.

“We are not committing to shipments in December," the trader said. "Then the customer wants to cancel the order because prices are falling.”

Another local trader said the issued had reached a point of needing renegotiation.

"The customer is angry and no longer wants to buy," the second trader said, adding US ports were still congested for both departures and arrivals due to the aftereffects of the strike.

A Brazil-based trader working in the PVC, PP and PE markets said the main concern was inventory levels.

“Shipping will happen, with or without delays. I’m not worried about that," the Brazil-based source said. "It’s just a matter of making sure we are supplied.”

Prices for US PVC have been decreasing lately. Market sources reported an offer at $730/mt CFR Brazil on Nov. 4, which would be around $820/mt considering the 8.2% anti-dumping rate. Comparatively, an offer for US-origin PVC was heard at $760/mt CFR Brazil on Oct. 15.

Platts, part of S&P Global Commodity Insights, last assessed PVC at $835/mt CFR Brazil on Oct. 30, up $5 from Sept. 25.

Delays were also reported in Brazil's isocyanate and polyol market.

"Toluene diisocyanate is facing many delays, but the market is not reacting to this information and delays due to lower domestic demand,” a distributor said.

In Uruguay, a PP and PE distributor said the prolonged transit times from the US meant the market was concentrating purchases from local producers, especially with prices falling.

Platts assessed HDPE film basis CFR Mercosur at $1,045/mt on Oct. 30, down $90/mt from Sept. 25.