IHS Chemical Comments on Tianjin Explosion

IHS Chemical reported that the impact of the recent explosions that occurred in Tianjin, China on the chemicals supply chain in the country is expected to be minor.

A fire broke out late on Wednesday night at the container warehouse at the Tianjin Port and caused two major explosions in the warehouse that stores hazardous materials.

The warehouse is owned by logistics firm Tianjin Dongjiang Port Rui Hai International Logistics Co., the official Xinhua press agency says. There has been no official confirmation of the type of chemicals that was being stored in the warehouse. The death toll following the massive explosions rises.

According to IHS Chemical, the explosion has destroyed 25,000-30,000 m.t. of linear low-density polyethylene that was being stored in the affected area. The destroyed stock is equivalent to almost 50 percent of monthly polyethylene imports through the port of Tianjin, IHS Chemical says.

“As the explosions occurred in a container warehouse, there were no bulk chemicals/plastics involved in the explosion,” said Paul Pang, vice president, managing director/China, IHS Chemical. “If bulk chemicals/plastics were damaged as a result of the incident, it was not significant enough to impact supply, he added. “Bulk chemical tank firms are not in the same district, and therefore there is no direct impact [on the supply chain]. Only several chemical iso-tanks were damaged.”

Loading/unloading of chemicals at the Tianjin port is currently suspended and transportation of chemicals by land has also been suspended, IHS Chemical says. “As a result, there is an interruption in the supply of chemicals/plastics in North China. However, this interruption is not likely to last more than two weeks. Tianjin is not a major chemical port, and the impact on the entire chemicals supply chain in China should be minor,” Pang said.