Europe capro slump could benefit soda ash makers
10 October 2008 13:58 [Source: ICIS news]
LONDON (ICIS news)--Current cuts in European caprolactam and nylon 6 production could benefit the soda ash business, a producer said on Friday.
“Caprolactam and nylon 6 producers have dropped production levels by up to 25%,” the source said. "As soda ash is a by-product of those processes, this could be good for the soda ash business."
Because of a reduction in demand for nearly every downstream application, the majority of European caprolactam producers have confirmed that they were running at reduced rates or considering doing so.
Domo Caproleuna said that it had reduced rates at its Leuna, Germany, plant by 20% because of a 20% drop in demand for nylon 6.
DSM also reported this week that it was running its European caprolactam operations at reduced rates because the product was too expensive to produce.
BASF confirmed last week that it was running its European caprolactam facilities at 75% rates because of the poor economic climate.
In eastern Europe, Poland’s Zaklady Azotowe Pulawy (ZAP) said it was considering reducing production due to oversupply, while Ukrainian producer Cherkassy temporarily closed its plant from 1 October because of unfavourable production economics and Russia's Kuibyshev had been running its capro and polyamide production at 30% below capacity because of raw material costs.
There have been growing concerns about demand for soda ash as a result of the declining European automotive and construction industries, but the producer dispelled these fears.
“Demand is waning for flat glass in the automotive and construction industries,” it said.
"However, demand for glass used in bottling applications, detergents and sodium bicarbonate in the food, feed, and pharmaceuticals markets is not going to change.
"There could even be a slight increase as customers have requested larger volumes for 2009."
For more on caprolactam and soda ash visit ICIS chemical intelligence
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By: Stuart Moir
+44 20 8652 3214
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