MOSCOW (MRC) -- Solvay's Rhodia chemical producer in Brazil is halting some of its units amid a water shortage, widening the list of companies being impacted by Sao Paulo’s worst drought in more than eight decades, according to Hydrocarbonprocessing.
Rhodia shut four of its 22 output units at its Paulinia plant in Sao Paulo state because the river where it collects water is drying up, spokesman Roberto Custodio said by phone. The company is carrying out unscheduled maintenance on the units until water supplies return to normal.
Businesses across Sao Paulo, from restaurants to factories, are facing cuts to supplies, threatening economic growth in the state that’s responsible for a third of Brazil’s gross domestic product. Pulp producer Fibria Celulose is working on a contingency plan should its water be cut, and sugar association Unica is warning mills to come up with a backup plan. Textile group Abit said its members are already experiencing water shortages.
"Given its importance, anything that happens in Sao Paulo affects Brazil’s economic growth," said Leonardo Dutra, sustainability consultant director of Ernst & Young. "This lack of water can slow the country’s economic recovery."
Brazil’s economy slipped into a recession from January to June for the first time since 2009. With 40 million people residing across 96,000 square miles (250,000 square kilometers), Sao Paulo state is geographically bigger than the UK Seventy of the 645 cities in the state are already facing water shortages and 38 have started rationing, newspaper O Estado de S. Paulo reported this month.
As MRC wrote before, in 2011, Rhodia and SIBUR signed a letter of intent to create a joint venture in specialty surfactants. This strategic alliance would be focused on creating a leader in the CIS market where specialty surfactants are used particularly in home & personal care, and oil & gas industries, with the surfactants sector growing at more than 6% per year.
Solvay is an international chemicals and plastics company. In 2011, Solvay acquired Rhodia for approximately EUR 3.4 billion. Rhodia is one of the three sectors of activities of Solvay. Rhodia is a world leader in the development and production of specialty chemicals, and partner of major players in the automotive, electronics, flavors and fragrances, health, personal and home care markets, consumer goods and industrial markets.
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