FocusChina caprolactam production lags behind nylon expansion

23 August 2010 09:21  [Source: ICIS news]

By Junie Lin

Nylon rope is one of the downstream applications of caprolactam.SINGAPORE (ICIS)--China’s caprolactam capacity will significantly fall behind the robust expansion of downstream nylon industry next year, market sources said on Monday.

The country was estimated to boost its output of nylon derivatives, including nylon yarns, by 460,000 tonnes/year this year but caprolactam production would stay the same until 2012, they said.

Caprolactam is an intermediate primarily used in the production of nylon 6 fibres, plastics and other polymeric materials. Nylon, on the other hand, is widely used in the manufacture of hosiery, knitted garments, threads, ropes, filaments, nets and tire cords.

“With so many Chinese nylon projects planned … There is no doubt that this will further tighten the capro supply,” said a major China-based caprolactam producer.

Caprolactam is an intermediate primarily used in the production of nylon 6 fibres, plastics and other polymeric materials.

Li Heng is currently building a 100,000 tonne/year nylon 6 plant in Fujian, which would be the largest such facility in the world when it is completed in end-2011.

“We are also in the midst to increase our yarn capacity by another 50,000 tonne/year to 200,000 tonne/year [by 2012],” said a company source.

China would need to import 862,000 tonnes of caprolactam to run its existing nylon plants this year, market sources said.

The country produced 682,000 tonnes of nylon chips in 2009, while its caprolactam output was barely half that size at 319,000 tonnes.

New caprolactam production would only come on stream in 2012, led by China Petrochemical Development Corp (CPDC), which would double its nameplate production capacity to 200,000 tonnes/year in Toufen, Taiwan, said a company source.

In the same year, CPDC also plans to raise the capacity of its 180,000 tonne/year caprolactam line in Kaohsiung by 20,000 tonnes, through debottlenecking, the source said.

Limited caprolactam availability amid strong nylon capacity expansion would likely push up prices of the feedstock next year, market sources said.

Since the start of the year, monthly contract prices of caprolactam increased 14.8% on the back of strong demand from the downstream tire cord segment in China.

August contract prices were settled at $2,500-$2,530/tonne (€1,975-1,999/tonne) CFR NE Asia, according to ICIS data.

($1 = €0.79)

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By: Junie Lin



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