Huntsman Corporation announced last week that a mechanical failure at a third-party raw material supplier is forcing its Geismar MDI facility to experience a partial outage.
The outage is estimated to last approximately five weeks.
The Geismar plant produces methylene diphenyl diisocyanate, also known as MDI, which is used in polyurethane manufacturing for products such as insulation, furniture, plastic, shoes and pharmaceuticals. Roughly 80% of the chemicals produced at the plant are used in North and South America; the rest are exported elsewhere.
Construction of a new MDI splitter is underway at the facility, scheduled to come online in the middle of 2022. The splitter will not raise the capacity of the plant, but will allow the company to offer more differentiated grades of MDI to the market.
The company is currently estimating that this will impact its Q4 EBITDA by approximately $15 million. An update is planned for its third quarter earnings conference call on October 29.