Media: Vietnam’s Long Son Petrochemical eyes restart amid tentative market recovery

Long Son Petrochemical, a $5.4 billion integrated complex in Vietnam operated by Siam Cement Group (SCG), is considering a restart of operations following a prolonged commercial shutdown, according to media reports. The move comes as early signs of a market rebound begin to emerge, particularly in the wake of improving conditions in China.

In an interview, SCG Chief Executive Officer Thammasak Sethaudom stated that production at the complex could resume within a month of a formal decision being made. The facility, located in southern Vietnam, has been offline since October 2024 due to persistently weak production margins.

The Long Son complex comprises a 950,000 tons/year naphtha cracker, supported by downstream units capable of producing 500,000 tons/year of LLDPE, 450,000 tons/year of HDPE, and 400,000 tons/year of PP. The plant’s commercial viability is heavily influenced by fluctuations in feedstock costs and product spreads.

A temporary 90-day tariff truce between the United States and China has provided a short-term lift to regional manufacturing sentiment, particularly in China, easing oversupply concerns in the Asian petrochemical market. “This is a sign that prices have probably reached the bottom,” Mr Thammasak noted, suggesting a potential window for the Vietnam facility to restart.

He added that the price spread between PP and naphtha had recovered to over $400/ton following the tariff truce, before retracing to around $350/ton. SCG estimates that a spread of approximately $380/ton is required for the Long Son complex to operate profitably. The recent decline in crude oil prices has also contributed to an improvement in chemical margins.

In a strategic move to reduce feedstock risk and enhance cost competitiveness, Long Son Petrochemical announced in November 2024 a $700 million investment in a new ethane storage facility. The project aims to diversify the plant’s feedstock base away from naphtha, which proved cost-prohibitive during 2024 and contributed significantly to the decision to halt operations.

The prospective restart is being closely watched by market participants, as it could signal a broader turning point for the regional petrochemical sector — albeit one that remains fragile and highly dependent on macroeconomic developments.