Europe ADA market oversupplied by up to 130,000 tonnes/year

27 February 2013 17:24  [Source: ICIS news]

LONDON (ICIS)--The European adipic acid (ADA) market is oversupplied by up to 130,000 tonnes/year and is in need of consolidation, sources said on Wednesday.

“The general comment is that the European market is in overcapacity by 130,000 tonnes/year,” an adipic acid buyer said.

This is because additional production capacity in Asia has meant that the region is increasingly relying on domestic supply, at the expense of importing material.

“Let's be honest, with the extra capacity in Asia, which limits exports, there's an overcapacity but not to the extent of the deterioration of the margins,” a European adipic acid producer said.

Asia has traditionally been a major market for European ADA material.

Several players said that there is a need for consolidation in Europe to bring the market back into balance.

Views on the actual level of oversupply ranged from 80,000-130,000 tonnes/year, depending on operating rate estimates. There have been no announcements of plans to idle European adipic acid production.

 ($1 = €0.77)

By: Mark Victory
+44 208 652 3214

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