11 July 2012 10:59 [Source: ICIS news]
LONDON (ICIS)--Shchekino JSC has shut down its 60,000 tonne/year caprolactam (capro) plant in Shchekino, Russia, a company source said on Wednesday.
The plant – which is located near Moscow – was shut because of a related maintenance shutdown on the company’s cyclohexanone plant. Cyclohexanone is an intermediate used in the production of capro, and is used in the production of ketone-alcohol oil (KA oil).
The capro outage will last until November and Shchekino JSC is currently selling from capro reserves. From 16 August until November the company will have no stocks of capro and will temporarily exit the market, the company source said.
European caprolcatam margins are weak. Since June 2011, caprolactam prices have fallen by €190–230/tonne ($232–280/tonne). Upstream benzene prices, conversely, have risen by €119/tonne, resulting in reduced profitability.
European producers have said that if they are unsuccessful in restoring profitability in July, they will cut back operating rates. Some producers already have contingency plans in place to reduce operating rates to 60% of capacity in July.
European caprolactam demand is weak because of reduced consumer purchasing power, which has been caused by declining macroeconomic conditions.
The downstream fibre market has been most severely affected by the wider economic downturn, with fibre production rates estimated at as low as 50% by market participants.
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