08 February 2011 23:59 [Source: ICIS news]
LONDON (ICIS)--European domestic nylon 6 (or polyamide 6) prices for February settled at an increase of €0.14-0.15/kg ($0.19-0.20/kg) from January because of strong demand, tight supply and rising upstream benzene costs, sources said on Tuesday.
Virgin polymer nylon domestic February prices were trading at €2.34-2.45/kg FD (free delivered) NWE (northwest Europe), according to ICIS.
The February benzene contract price increased by €122/tonne.
Increases beyond the benzene contract cost rise were aimed at restoring weak margins and had been achievable due to strong demand and tight supply, players said
Some buyers linked to the downstream carpet market said that they had managed to limit February price increases to the benzene cost rise, because weak demand meant that they could not pass the price hikes on to their customers, but their prices remained in the €2.34-2.45/kg range.
Demand for carpets in January was weaker than expected, sources said. Players were unclear what was causing the poor consumption, but said that it could be linked to declining macroeconomic conditions.
Some contract negotiations were ongoing, and producers said that prices could increase by up to €0.20/kg over the course of February, in order to recoup margins.
Tight supply was the result of difficulties in sourcing feedstock caprolactam, according to players.
Strong demand was driven by exports of finished goods in the downstream textiles and automotives markets, sources said.
Textiles demand was strong because shortages of cotton - the result of flooding in Pakistan and Taiwan in the fourth quarter of 2010 - meant that Asian buyers were turning to synthetic textiles as an alternative, players said.
High automotive buying interest in Asia was the result of GDP growth and upward social mobility in China. It was believed that more than 50% of finished German automotives were being shipped to Asia, according to sources.
($1 = €0.74)
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|
Asian Chemical Connections