Sherwin Alumina closure likely to impact US caustic soda demand

The possible closure of Sherwin Alumina near Corpus Christi in Texas, is likely to impact caustic soda market in the U.S. in a major way. Industry experts are of the opinion that the closure of the mid-size alumina refinery that recently applied for bankruptcy will remove about 150,000 tonnes/year of caustic soda demand from the U.S. market.

Sherwin Alumina informed its workers last week that the 1.65 million tonne/year capacity alumina refinery in Gregory, will soon “commence an orderly wind-down of its operations” after a months-long lock-out of 400 union workers.

The closure is the consequence of the bankruptcy of Noranda Aluminum, the company’s bauxite supplier, and rejection of its supply contract with Sherwin. This literally sealed the refinery's fate for good putting the jobs of 600 odd workers at stake.

“Unfortunately, at this time, the best available option for our stakeholders is an orderly wind-down of Sherwin’s operations,” CEO Thomas Russell told workers in a statement.

The plant was procuring liquid caustic soda from a nearby supplier through a pipeline. Because the plant is on the coast, the displaced material will simply move to the export market, a representative of the supplier said.

“The lost caustic demand from the Sherwin refinery will be exported from our Ingleside plant and the tons they were producing will be produced in other major alumina production regions of the world like Brazil and Australia,” the source said.

Major US producers of caustic soda include Axiall, Formosa Plastics, Occidental Chemical, Olin, Shintech and Westlake Chemical.

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