21 May 2013 16:17 [Source: ICIS news]
Capro is the feedstock for nylon 6 (or polyamide 6), and many nylon 6 producers are backwards-integrated with capro.
Asia is traditionally a major importer of capro from Europe. However, new capacity in the region has reduced its reliance on European material.
As a result, some integrated producers are diverting capro previously earmarked for export into the production of additional nylon 6.
“There's too much material available. Capro producers used to export to Asia, now they have to sell the material here,” an integrated producer said.
An integrated producer estimated that there is a structural oversupply of European capro of around 1m tonnes/year.
Coupled with nylon 6 oversupply, demand in May 2013 for nylon 6 has been estimated by market sources to be 10% below the same month in 2012 because of poor macroeconomic conditions.
“Difficult to detect if it’s demand or destocking, but I think 10% down May 2013 compared with May 2012,” a nylon buyer estimated.
Weak demand and oversupply have placed downward pressure on nylon 6 May contract prices. Although negotiations are at an early stage, some nylon 6 buyers said that they have agreed May nylon 6 contract price reductions of €0.02-0.03/kg.
($1 = €0.78)
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