28 February 2012 23:59 [Source: ICIS news]
LONDON (ICIS)--European nylon 6 February contract prices have settled at an increase of €0.10–0.15/kg ($0.13–0.20/kg) because of rising upstream costs and the need to recover margins, buyers and sellers confirmed on Tuesday.
The February nylon 6 (or polyamide 6) settlement followed an upstream February benzene contract price increase of €114–119/tonne.
Nylon 6 demand is strong because of restocking, pre-buying and rising consumption from the downstream automotive sector.
Nylon 6 players are expecting availability to tighten in March because of an outage at a major caprolactam producer, Netherlands-based life sciences and materials sciences company Royal DSM, which will limit feedstock availability and, in turn, cause tightness in the nylon 6 market.
This, along with expectations of higher prices, has led to pre-buying.
DSM will be entering into a planned turnaround at its 250,000 tonne/year caprolactam plant, at Geleen in the ?xml:namespace>
“If you’ve not prepared for the DSM outage, it [nylon 6] will be tight,” a nylon buyer said.
For March contracts, nylon 6 producers are targeting price rises of €0.10/kg beyond any movement in the benzene contract price, in order to re-establish margins lost during the fourth quarter of 2011.
“We are looking for at least [an increase] of €100/tonne in March above benzene,” one nylon producer said.
Consumption is being further boosted by restocking of empty pipelines following heavy destocking in November and December ahead of the year-end and just-in-time buying in January on macroeconomic uncertainty.
Strong automotive demand is being driven by buying interest in
“March demand is extremely strong. March has seen the strongest demand in the last year, for reinforced and unreinforced product,” a producer said.
Nylon 6 virgin polymer contracts were finalised at €2.35-2.50/kg FD (free delivered) NWE (northwest
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