06 March 2013 17:45 [Source: ICIS news]
End users are preferring to use PET rather than nylon 6 because PET prices are currently substantially below nylon 6.
“We can see a substitute in automotive and fibre [markets],” a nylon producer said.
PET film grade February reference contract prices are €1,310-1,330/tonne ($1,701-1,727/tonne) FD (free delivered) NWE (northwest Europe). February nylon 6 virgin polymer contract prices are €2,100-2,220/tonne FD NWE.
“We've looked into polyesters rather than polyamide - PET substitution's starting. We've been swapping polyamide capacity with PET fibres - the fibre price is sometimes cheaper than I can produce myself,” a nylon buyer said.
Nevertheless, the substitution is only possible for non-specialist applications, and is expected to have a limited effect on the overall nylon 6 market.
“[I] wouldn't have thought many applications have an opportunity to switch [between PET and nylon],” a nylon buyer said.
This is because in the case of major downstream fibre applications, such as hosiery, European consumers have a strong preference for nylon.
The same preference is not seen in Asia, sources said, where substitution for PET is becoming increasingly common.
“In some applications, especially some textiles, it's true they're substituting PET for nylon. For certain quality it might be better... in hosiery, of course, polyamide is much better, you can use PET but it's a different kind of material. If you look in China though, PET is more prevalent,” a nylon manufacturer said.
Substitution is also not possible for specialised automotive parts, which constitute the bulk of nylon 6 consumption from the car production sector.
The substitution has only become apparent in recent weeks, sources said, and is opportunistic rather than structural.
One producer said that although the overall nylon 6 share of the fibre market fell between 1980 and 2007, it has been stable since, constituting an overall increase in demand because the size of the market has increased between 2007 and 2013.
“It's true the margin share has decreased between 1980 and 2007, but since 2007 nylon 6 has developed its market share, and since the market size increased, nylon 6 has increased its share. [It could be] opportunistic buying, but we haven't heard yet,” the producer said.
($1 = €0.77)
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