Afton Chemical notified customers that it declared force majeure effective July 26 because of flooding at its additives plant in Sauget, Illinois, caused by record rainfall in the St. Louis area, which caused an unplanned, sitewide outage. Products affected include engine oil additive packages.
According to industry sources, Afton notified customers that while it was working to restore power to the site and unit operations, the unplanned outage left it temporarily unable to meet its supply commitments for certain products. As a result, Afton declared the force majeure event and told customers it would limit order quantities for products that are manufactured in North America – engine oil additive packages and some off-road products.
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The company explained to customers that because it is already importing key components from its global supply network as part of its business continuity planning process, it can’t increase supply in other regions.
By deadline, Afton Chemical had not responded to requests for comment.
The global additives market has been plagued by supply issues since a fire at the Lubrizol additives plant in Rouen, France, in September 2019 caused extensive damage to the company’s facilities and took large volumes of additives out of the supply system. The situation was exacerbated by the COVID-19 pandemic as companies worldwide implemented restrictions and many employees were unable to go to work, with several additive plants cutting production or temporarily shuttering operations.
During the last quarter of 2021 and first quarter of 2022, lubricant blenders and finished products manufacturers were significantly affected by additive shortages that forced them to lower production rates and implement allocation programs as well. While the situation had improved by July, some blenders were still affected by a scarcity of additives and prices continued to be exposed to upward pressure. The force majeure at Afton Chemical’s plant was expected to exacerbate the strained market conditions.
– Gabriela Wheeler contributed to this article.