LONDON (ICIS)--Several European caprolactam (capro) buyers have concluded December contract prices at an increase of €30-35/tonne ($41-48/tonne), they said on Wednesday.
Despite the €109/tonne rise in the upstream benzene contract price, weak December demand, on the back of a short working month and typical year-end destocking to lower working capital on balance sheets, allowed buyers to limit increases, they said.
“All things in consideration [the rise in benzene of] €109/tonne is a big number but the market seems to settle at plus €30/tonne in capro [for December contracts],” a buyer said..
Producers conceded that low downstream consumption coupled with weak nylon 6 margins have meant that it will not be possible to pass the full benzene contract price rise through the polyamide chain in December.
“This is a really difficult moment because nobody expected such a jump [in the benzene contract price]] this was really faster than we thought. This combined with the ordinary discussion to the end of the year, it is, to be honest ,annoying,” a capro producer said.
"I really wanted to have at least €80/tonne of the €109/tonne [rise in the benzene contract price] but I'm not able to realise [this],” it added.
Nevertheless, several producers continue to target price rises of up to €60/tonne.
($1 = €0.73)