25 May 2012 05:10 [Source: ICIS news]
By Judith Wang
SINGAPORE (ICIS)--Asia adipic acid (ADA) prices will be likely under downward pressure in June and July because of persistently weak demand, softening feedstock prices, and new capacity from China, industry sources said on Friday.
Asia ADA prices for international origin cargoes fell by $50/tonne (€40/tonne) week on week to $1,700-1,800/tonne CFR (cost & freight) NE (northeast) Asia on 23 May, according to ICIS.
This represents a 10% drop from early April prices mainly caused by weak demand amid worsening eurozone debt crisis and ?xml:namespace>
During the same period, feedstock benzene prices fell by close to $100/tonne (€80/tonne), according to ICIS data. Benzene prices closed at $1,075-1,100/tonne FOB (free on board)
“The demand is bad this year but the
The situation in Asia is reflective of uncertainty prevailing in
Adipic acid is primarily used in the production of nylon 6,6, as well as in the manufacturing of polyurethanes which are used in shoe soles and polyester resins. Nylon 6,6, is used to make tyre cord, as well as other products.Most market participants in Asia said summer is usually the lull season for chemical manufacturing and therefore they expect the prices to soften more in the next two months.
Additionally, the new capacity from
The new plant has two lines with 80,000 tonne/year capacity each in the southwestern
“Supply is increasing, but there is no improvement in demand. As a result, there is little possibility that
However, due to the weak market condition, another two Chinese producers Shandong Haili and Shandong Hongye Chemical Industrial Group have opted to postpone the start-up of their plants with a total capacity of 290,000 tonnes/year to an unspecified date, company sources said.
“We will start up our new plant depending on the market situation,” a source from Shandong Haili said.
($1 = €0.80)
Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections
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