05 September 2012 07:59 [Source: ICIS news]
SINGAPORE (ICIS)--Asian September caprolactam (capro) contract talks are at a stalemate, as buyers and sellers remain divided over price targets, said buyers and sellers on Wednesday.
The majority of price ideas have narrowed to $50-100/tonne (€40-80/tonne) month on month to $2,350-2,400/tonne on a CFR (cost & freight) northeast (NE) Asia basis – with buyers now targeting a hike of $50/tonne and producers a $100/tonne increase at $2,400/tonne CFR NE Asia.
A major Japanese producer said he managed to settle a contract at slightly below $2,400/tonne CFR NE Asia with a major end-user in southern ?xml:namespace>
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Producers said they need to recoup margins resulting from the increase in upstream benzene prices.
August contracts were settled at $2,300/tonne CFR NE Asia, $50-70/tonne higher than in July, according to ICIS data.
Contract negotiations are expected to close by the end of this week, said buyers and sellers.
In the downstream nylon (polyamide) chips segment, northeast Asian producers are eyeing to sell their cargoes at $2,700/tonne CFR China, an increase of $80/tonne compared with last week’s offers, on expectations of feedstock capro contracts closing at a potential $100/tonne higher month on month.
Major nylon chips sellers said the weak downstream conditions have made it difficult to quote higher prices to their customers and that their selling ideas at $2,700/tonne CFR China are unfeasible in the current market.
Nylon chips buyers are in no hurry to make purchases, as their requirements are comfortably covered until mid-September, having previously procured cargoes in early August.
Capro is an intermediate product that is primarily used in the production of nylon 6 fibres, plastics and other polymeric materials.
Additional reporting by Angeline Zhang
($1 = €0.80)
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