Hurricane Harvey is, without a doubt, one of the worst natural disasters to ever strike our country. It is heartbreaking to see the photos and videos of the damaged homes and ruined public infrastructure. It’s impossible to fathom how and when the region will be rebuilt. Our hearts go out all affected by the hurricane.
We would like our customers to know that the impact of Harvey extends far beyond the Gulf region.
North Tonawanda, New York might seem like a long ways from Houston, Texas, but our operations could be adversely affected by the devastation.
A great percentage of North America’s high density polyethylene and its ethylene feedstock come from plants that were right in Harvey’s path. Many plants have closed down indefinitely while others have declared force majeure. As I write this letter, 46% of all of the US capacity has been shut down.
When will it go back up? Are we talking a couple of weeks? Or, is it a couple of months? No one knows at this time and no one will know until the waters recede and the facilities (and their workers) can be assessed.
Our suppliers and brokers have been telling us to plan for some major uncertainty. The only certainties that we are guaranteed at this time are, one, supply issues and, two, price increases this fall.
With our substantial silo capacity and our having purchasing considerable amounts of material earlier this month (which is sitting in rail cars), we have enough material to address immediate needs and satisfy most of the on-order production scheduled for September.
BUT, that ability to meet most of those immediate needs comes with a change in strategy at Confer Plastics. We had been planning to make 2018 inventory of our Confer-branded swimming pool ladders and steps in September. We have to delay that to mid-October to accommodate the potential crisis which might befall the North American plastics industry.
We don’t know what late-September or October will bring for us, our clients and our workforce. God willing, much of the polyethylene capacity will come back by then. But, Mother Nature has done — and still could do — some serious damage.
We will do our best to secure material and address our customers’ needs during this developing situation