Europe March caprolactam settles up €40/tonne

02 April 2008 23:59  [Source: ICIS news]

LONDON (ICIS news)--March caprolactam contracts were agreed at an average increase of €40/tonne ($63/tonne) over February on the back of an increase in March benzene, market sources said on Wednesday morning.

 

The contract price was assessed at €1,964-2,005/tonne FD (free delivered) NWE (northwest Europe) by global chemical intelligence service ICIS pricing.

 

“A €40/tonne increase is a fair representation,” a consumer said. “There were settlements at increases of €50/tonne for March but some lower.”

 

A large producer confirmed that €40/tonne was “an average increase”, while others quoted increments of €45-50/tonne.

 

“We feel that demand is stronger and price increases of €35-50/tonne have been accepted,” another producer commented.

 

Two large European caprolactam consumers reported March increases of €35-40/tonne.

 

Initial attempts by producers to raise the cost of the March caprolactam contract by €100/tonne were met with much resistance. Price initiatives were then revised to plus €50/tonne.

 

The March benzene contract was agreed at €787/tonne FOB (free on board) NWE.

 

Caprolactam producers and consumers spoke of a tough and drawn out round of discussions, hence the late settlement.

 

“It is too early to comment on the April contract, benzene has just settled, but I hope it takes less time,” said a large buyer.

 

The European April benzene contract settled on Monday at €742/tonne FOB, marking a decrease of €45/tonne on March.

 

Caprolactam contract negotiations for the current month are based on the previous month’s benzene contract settlement. Supply and demand dynamics are also a key talking point.

 

Meanwhile, downstream, demand for polyamide (PA6) remained steady according to most market participants. However, a large manufacturer of PA6 said that it was already slowing production rates because customers were taking less volume.

European caprolactam producers include BASF, DSM, Domo Caproleuna GmbH and Lanxess.

For more on caprolactam visit ICIS chemical intelligence

By: Julia Meehan
+44 20 8652 3214

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