22 July 2009 23:59 [Source: ICIS news]
LONDON (ICIS news)--European July caprolactam contracts have settled at an increase of €131/tonne ($187/tonne) because of firming benzene, producers and consumers said on Wednesday.
“I am close to closing all my contracts at an average increase of €131/tonne,” confirmed a major European buyer. “I also closed a contract at an increase of €135/tonne. Discussions were hard and it took a long time because producers wanted to improve margins,” the buyer added.
Another buyer said: “There is no problem with supply but we paid the full benzene [increase].” The source added that its demand for August was “looking good” and that it had no problems securing material.
On the selling side, a major producer described the market as “quite balanced but globally short” and because of this was able to pass through the full benzene increase of €131/tonne downstream.
A second producer said: “We settled at the full benzene [increase] last month and again this month… we are very tight and have been forced to buy to meet our commitments.”
The June caprolactam contract settled at a pre-discounted price of €1,568-1,624/tonne FD (free delivered) NWE (northwest ?xml:namespace>
The July benzene contract settled at €656/tonne free on board (FOB) northwest Europe (NWE), up €131/tonne.
A third producer was surprised that its competitors had only achieved an increase of €131/tonne for July contracts. “I concluded partially everything at [an increase of] €136-150/tonne and our volumes are good, very good,” the producer said.
Major European caprolactam producers include BASF, Domo Caproleuna, Lanxess and DSM.
($1 = €0.70)
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