Hurricane Francine, expected to make landfall on Louisiana’s coast on Wednesday, Sept. 11, poses a serious threat to a substantial portion of US petrochemical production.

The vinyls sector is particularly vulnerable, with 35% of the country's vinyl chloride monomer (VCM) capacity and 43% of its polyvinyl chloride (PVC) capacity located in southern Louisiana. Additionally, the region accounts for 43% of US caustic soda capacity and 42% of methanol capacity, according to S&P Global Commodity Insights. Other key production capacities in the area include 25% of the nation's ethylene, 22% of polyethylene (PE), 19% of polymer-grade propylene (PGP), and 21% of polypropylene (PP).

As of 1 pm on Sept. 10, Francine was still classified as a tropical storm, centered over the Gulf of Mexico about 150 miles from Brownsville, Texas, with maximum sustained winds of 65 mph. However, the US National Oceanic and Atmospheric Administration (NOAA) forecasts that it will strengthen into a hurricane by day’s end, potentially reaching 85 mph winds when it hits Louisiana.

A hurricane warning has been issued for the Louisiana coast, extending from Sabine Pass, near the Texas border, to Grand Isle, south of New Orleans. Francine’s expected landfall is near New Orleans, and its projected path will take it over Baton Rouge. While chemical facilities around Lake Charles may avoid the storm’s direct impact, those between Baton Rouge and New Orleans could face the storm's full force. This area includes significant ethylene, PE, propylene, PP, VCM, PVC, caustic soda, and methanol production capacities critical to the US petrochemical industry.

Source: S&P Global