ASSOCIATIONINSIGHT
Portable Sanitation Association International News
BIWEEKLY EDITION APRIL 14, 2021
Page 8
Supply Issues Create Challenges and Opportunities…continued from page 2
Continued on page 9
But merely getting the crude oil flowing again isn't enough to solve the
problem. Oil has to be refined and turned into the raw materials that
suppliers to the portable sanitation industry need. Sam Cooper, Plant
Manager at PolyJohn, previously worked in the petrochemical industry in
Texas before returning to the family business in Indiana a few years ago.
Here's what he told us about some of the production issues currently
plaguing the US market.
"I do have a little bit of unique insight on this from my previous
work in the chemical plants and refineries where these outages are
occurring. These plants have a very specific temperature operating
window. When the [February 2021] storms hit Texas, they experienced
extended low temperature and power outage scenarios. Refineries
plan for this, but not usually for all at the same time and for extended
periods of time.
"When the storms occurred, I called a friend…who is a plant supervisor at a hydrogen sulfide plant
in Texas City. He said they identified more than 100 leaks in their piping—and had analyzed only
half of the plant at the time. Massive compressors ($10M+ pieces of equipment) were down and
failed due to cooling line freeze ups.… He was working about 18-hour days and sleeping on site.
"Luckily some other plants fared better. I believe Exxon is still limping along, but not a full capacity.
When these plants are down, they lose tens of thousands of dollars an hour. I expect the high
material costs in HDPE, LDPE, and other resins to extend probably out until fall to make up for lost
production. It's a bad situation all around."
Sam's observations were echoed in a Wall Street Journal article from March 17 which stated,
"Plant operators have spent weeks scouring their pipes for leaks—a painstaking process that has
left many plants inoperable despite a resumption of power. More than two dozen plants remain off
line, according to the most recent count by S&P Global Platts."
As a result of these issues, ICIS reports
dramatic issues with production capacity in
the US resulting from the winter storms.
But even that is not the whole story.
Due to issues in accessing raw materials,
domestic plants that were not damaged
or that have been restored are also not
operating at full capacity. In some cases
the plant operators have had to shut down
production from time to time because they
have nothing to work with.
In a March 25 article, Bloomberg summed up the production issues this way:
"At the root of the problem lie a series of factors ranging from plants being shut down, the winter
storm in Texas and the global shortage of shipping containers—which got thrown off their usual
routes due to the pandemic. Add to that the strong economic recovery in Asia and demand for
consumer goods in the U.S., and companies are at pains to secure supplies."
Sam Cooper
