LONDON (ICIS)--European Cyclohexane (CX) material is becoming increasingly difficult to source, sources confirmed on Wednesday, with spot prices heard at a significant premium to contract. ?xml:namespace>
The CX market is tight because of ongoing production problems and a lack of imports into Europe. Imports from overseas have been limited by tight supply in the US.
CEPSA’s force majeure at its 180,000 tonne/year CX plant in Huelva, Spain, will last throughout June, a company source previously confirmed.
Coupled with the CEPSA force majeure, there was widespread talk of production problems at a second European CX producer, but this was denied at the source.
Spot prices were heard at €1,410-1,450/tonne FCA (Free carrier) ARA (Amsterdam-Rotterdam-Antwerp), with prices spiking above contract prices as players seek to cover shortages.
Nevertheless, one trader said that prices were theoretical because there are no spare molecules in the market.
The June contract price was assessed on Wednesday at €1,136/tonne, a fall of €71/tonne from May, following the settlement of the June feedstock benzene contract price.
The monthly CX contract price is comprised of the sum of the CX quarterly delta contract and the monthly benzene contract price and is settled on an ex-works northwest Europe (NWE) basis.
Players in the downstream European adipic acid (ADA) market are debating the implications of the CEPSA CX force majeure. While some producers said that it is has become difficult to source the raw material, others say the impact on the ADA market is much less evident. One producer commented that regular customers are ordering normal volumes and it has not received an influx of enquiries from other buyers.
Downstream European caprolactam (capro) players remain concerned that CX tightness will limit capro availability in the coming weeks, nevertheless, the majority of players are yet to see an impact on capro supply.