Europe March capro contracts roll over as producers recover margins

03 April 2014 10:16 Source:ICIS News

LONDON (ICIS)--European caprolactam (capro) March contracts finalised at a rollover because of producers’ need to recover margins against feedstock cyclohexane (CX), which fell by €52/tonne in March, buyers and sellers confirmed late on Wednesday.

Expectations of tight supply during the second quarter on the back of a heavy maintenance schedule, along with increasing downstream demand, meant that producers were able to resist reducing prices in line with feedstock costs.

Producers had originally targeted price rises in March because of poor profitability. Buyers managed to avoid price increases because of their own weak downstream margins.

The spread between capro and CX narrowed by €77-90/tonne between November and February, with a partial recovery in the spread seen in March, while the spread between downstream nylon 6 and capro contract prices fell by €22-35/tonne between November and February.

The €30/tonne rise in the nylon 6 March contract price has meant that the nylon 6 spread against capro has returned to similar – albeit marginally wider – levels seen in November.

Nylon 6 to capro to CX price spread (€/tonne)


Capro contract FD NWE

Nylon 6 virgin polymer contract FD NWE

Nylon 6/capro Spread

CX contract ex-works

Capro/CX spread































Demand for European product from Asia is also increasing, with buying interest largely coming from the tire cord industry in China. Most Asian buyers had stayed out of the market when prices were declining on fears of incurring losses should prices drop further. However prices have bottomed out on the back of higher April contract nomination prices from DSM and Sinopec.

By Mark Victory