19 April 2010 06:08 [Source: ICIS news]
By Heng Hui
SINGAPORE (ICIS news)--Adipic acid (ADA) values in Asia hit a record high last week and may remain at strong levels for most of the second quarter, due to a seasonal pick-up in demand while supply is tight, market players said on Monday.
Spot ADA prices surged by about a quarter from mid March to $2,600-2,700/tonne (€1,924-1,998/tonne) CFR (cost and freight) NE (northeast) Asia last Friday, based on the assessment of global chemical market intelligence service, ICIS pricing.
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Rhodia had restarted its 140,000 tonne/year
Come May, it would be Asahi Kasei’s turn to shut down its 120,000 tonne/year plant in
Buyers, worried about obtaining adequate supply, were willing to procure
Shoe soles, nylon fibres and synthetic leather are among the downstream sectors of
Nylon 6,6 prices, for example, had jumped by 18% from mid March to $4.32/kg FOB (free on board)
“Better buy your shoes and apparel quick, before you find they cost three times more than what you used to pay for them,” said a trader.
ADA producers has been enjoying healthy margins given a wide price spread with feedstock benzene at $1,590-1,705/tonne, with conversion costs pegged at around $800-900/tonne, market sources said.
Last Friday, benzene was quoted at $995-1,010/tonne FOB (free on board)
ADA prices would have to stabilize since they had hit maximum levels that end-users could afford, with an expected easing sometime in June or July, market sources said.
“I expect prices to slip once the peak manufacturing season is over and many of the scheduled turnarounds are completed,” said a supplier.
But in the meantime, he said: “I’ll be enjoying the profits while I can."
($1 = €0.74)Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections
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