Asia’s May capro contracts discussions stall on weak downstream

03 May 2012 09:37  [Source: ICIS news]

BRISBANE (ICIS)--Asia’s May caprolactam (capro) contract negotiations stalled this week because of weak downstream demand, buyers and producers said on Thursday.

May offers were around $70-100/tonne (€53.2-76.0/tonne) lower than April settlements at $2,650-2,700/tonne CFR (cost & freight) NE (northeast) Asia, they added.

“No progress will be made in [the] next few days’’, a northeast Asian nylon chip maker said of the discussions.

“Holidays in the region also contributed to slow negotiations,’ a northeast Asian producer said.

Japan is away for most for the week for its Golden Week holiday while China has just returned from its Labour Day holiday from 29 April to 1 May.

In the week ended 1 May, downstream semi dull nylon chip (polyamide) prices in Asia plunged $50/tonne week on week to $2,900-3,000/tonne CFR China, according to ICIS.

A major northeast Asian nylon chips maker said it was hardly able to break even at $2,900/tonne and capro makers are asking for contracts priced from $2,650/tonne.

Nylon chips makers typically need a spread around $300/tonne between capro and nylon chips prices to maintain margins.

($1 = €0.76)

By: Junie Lin

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