LyondellBasell to close Brindisi polypropylene output
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IN SHORT
LyondellBasell will close its Brindisi, Italy polypropylene plant by year-end due to economic challenges and high costs, with union talks ongoing for potential alternatives. Meanwhile, India may extend a petrochemical import duty waiver past June 30 if Iran war supply disruptions persist. In the US, PET bottle collection rates dropped to 30.2% in 2024, and demand for recycled PET (rPET) weakened as its price premium over virgin PET widened.
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Key Numbers
30.2%US PET bottle collection rate in 2024
32.5%US PET bottle collection rate in 2023
Who's Involved
LyondellBasell
Company planning polypropylene plant closure in Brindisi, Italy
Brindisi, Italy
Location of LyondellBasell's polypropylene production facility
India
Country considering extension of petrochemical import duty waiver
Country experiencing decline in PET collection and rPET demand
NAPCOR
Organization reporting on US PET collection and rPET market
Key facts
LyondellBasell plans to close its Brindisi, Italy polypropylene plant by year-end.
Challenging macroeconomic conditions and high operating costs are cited for the Brindisi plant closure.
Union sources indicate the Brindisi closure is conditional on finding alternative solutions for the unit.
India may extend its petrochemical import duty waiver beyond June 30.
The potential extension of India's waiver is due to Iran war supply disruption concerns.
India's waiver was initially implemented in April to mitigate rising domestic industry costs.
US PET bottle collection rates fell to 30.2% in 2024.
US PET bottle collection rates were 32.5% in 2023.
Demand for recycled PET (rPET) in the US has weakened.
The price premium of rPET over virgin PET has widened, contributing to weakened demand.
LyondellBasell intends to shut down its remaining polypropylene production at its Brindisi, Italy facility by the end of 2024. The company cites difficult macroeconomic conditions and elevated operating expenses as reasons for the closure. Union representatives have stated that the plant's closure is contingent upon LyondellBasell's inability to secure alternative solutions for the unit.
In a separate development, India is contemplating an extension of its waiver on petrochemical import duties, which is set to expire on June 30. This consideration is driven by ongoing supply chain concerns stemming from the Iran war. The waiver, first introduced in April, was designed to alleviate rising costs for domestic industries reliant on petrochemical imports.
Concurrently, the United States has seen a decrease in PET bottle collection rates. According to NAPCOR, these rates fell to 30.2% in 2024, a decline from 32.5% recorded in the previous year. The demand for recycled PET (rPET) has also softened. This weakening demand is attributed to a growing price difference between rPET and virgin PET, even as supply and processing capacity for rPET have increased.
↳ Why This Matters
LyondellBasell intends to shut down its remaining polypropylene production at its Brindisi, Italy facility by the end of 2024. The company cites difficult macroeconomic conditions and elevated operating expenses as reasons for the closure. Union representatives have stated that the plant's closure is contingent upon LyondellBasell's inability to secure alternative solutions for the unit.
Frequently asked questions
Polypropylene is a versatile thermoplastic polymer commonly used in packaging, automotive parts, textiles, and various industrial applications.
The company cited a challenging macroeconomic environment, uncertainty around feedstock availability, and high operating and logistics costs as reasons for the closure.
The unit has a nameplate capacity of 260,000 tonnes per year.
Yes, LyondellBasell stated it remains committed to the European market and will continue to meet customer demand through its broader production network.
What Happens Next
01LyondellBasell to cease remaining polypropylene production at Brindisi by year-end.
02Eni and JPMorgan to seek a buyer for the Versalis cracker plant.
03LyondellBasell to continue meeting European demand through its remaining production network.
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