South China chemical plants cut output on winter-related woes

    The chemical plants in south China implemented cuts in production as they contend with government-enforced power cuts, as well as logistics problems, due to continued heavy rains and snowing this week, industry sources said on Friday.

Snow and sleet were widespread in the localities of Hunan, Guangxi, Chongqing, Giuzhou and Yunnan since Monday, according to state-run media organisation, China Daily.

Some plants had to shut operations as the Chinese government imposes curbs on industries’ energy use to prioritise heightened heating needs during the winter months, industry sources said.

The power curbs forced some chlor-alkali plants in Jiangsu province to run at low operating rates of 70-80%, sources said.

Most fertilizer plants in central Shanxi province also operated at reduced rates due to tight supply of feedstock coal, domestic producers said.

Coal supply was being diverted for electricity generation, they said.

“We just experienced a round of power restrictions to meet the 11th five-year-plan energy reduction target late last year, but didn’t think that the ‘second round’ power cut [would] come again,” a fertilizer producer said in Mandarin.

Meanwhile, supply and delivery of chemicals was being hampered by the harsh weather conditions, with more than 80 national expressways and provincial roads still jammed with stranded vehicles as of Friday morning, according to China's Ministry of Transport.

In China’s financial hub and port city of Shanghai, delivery of base oils to other regions was hindered by heavy snow, which was seldom seen in the southeastern city, said a local trader.

Early this month, transportation of some petrochemical cargoes in southwest China was disrupted due to shutting down of highways amid heavy snowing.

Flights were also briefly cancelled in a number of airports, including those in Zhejiang, Jiangsu, Anhui and Guizhou provinces, according to media reports.

Petrochemical players in southern China had to cope with similar problems about two years ago due to heavy snowfall.