To everyone’s surprise, one of the main players in the Montreal East petrochemical industry, Indorama Ventures, announces the complete closure of its activities. A decision that could cause more bad news in the sector in the East.
In a shock, about 140 workers at the compound manufacturing plant intended for the manufacture of polyester learned the news yesterday evening. All activities at its purified tepalic acid (PTA) production plant will cease from next September.
“No one expected it. It was like a bolt of lightning in the blue sky,” he said Journal, Daniel Cloutier, Quebec director of the Unifor union, which represents about 80 employees in this factory. The union has since tried to get information from the company in the hope of overturning its decision.
Closure as a solution
Senior management, based in Bangkok, Thailand, declined all interview requests this morning. In a press release, he states that his decision is in response to developments in the global polyester industry, which is currently struggling with excess production capacity mainly from China.
These cost pressures, combined with an inflationary environment and increased demand for polyester from recycled sources – which are not produced at its Quebec factory – caused the company to decide to discontinue its activities in Montreal, as in other countries.
One of the most recent, in April, was located in Rotterdam, the Netherlands. It happened after the closure of another factory operating in the same activity sector as Montreal East, this one located in Portugal. In response, the European Commission is studying the possibility of imposing new customs tariffs to try to limit the import of these materials, especially from China.
Fear of a domino effect
Oh Journal, the mayor of Montreal East, Anne Saint-Laurent, said she was saddened by this news that she did not see coming from anyone. “The company did not ask for anything and did not warn us in advance. We learned it like everyone else, from employees who would soon be asked to go on unemployment.”
This announcement worries him even more since Indorama is a major link in the polyester production chain in Quebec. “If one falls, what will happen to the others who sell to Indorama or get supplies from its production? Will the whole chain collapse?”
Himself from this industry, Daniel Cloutier, from Unifor, has the same concern. “These are all businesses that work together; they are interconnected. That’s why this closure could easily affect the jobs of thousands of workers. It’s serious.”
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