23 October 2013 23:59 [Source: ICIS news]
LONDON (ICIS)--European caprolactam (capro) October contract prices have fallen by €30/tonne ($41/tonne) on average, representing a pass-through of 59% of the upstream benzene October contract price decrease, and in line with the downstream nylon 6 October settlement, sources said on Wednesday.
The benzene contract price fell by €51/tonne in October.
Settlements were reported at between falls of €20/tonne to €35/tonne, but €30/tonne was widely verified and seen as the average.
Producers had originally been targeting a rollover in order to restore margins, but expectations that the benzene November contract price will fall further forced them to give some ground.
Buyers had been targeting the full benzene price decrease in order to restore their own downstream margins on nylon 6, but a compromise position was reached.
Capro consumption in 2013 is expected to be up to 10% below 2012 levels, one producer said this week. The fall has been driven by poor consumption in southern Europe.
Southern Europe consumption has been heavily limited by poor macroeconomic conditions. Southern Europe saw a greater impact from the Eurozone debt crisis than northern Europe.
Coupled with this, premium automotive demand – which is concentrated in Northwest Europe – has been performing well because of exports to Asia on upward social mobility, while other areas of demand such as fibre have been weak.
The capro October contract price settled at €1,878-1,905/tonne FD (free delivered) NWE (northwest Europe).
($1 = €0.73)
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