Europe adipic acid prices still rising despite feedstock decline

LONDON (ICIS)–Converters in the Europe adipic acid market are continuing to face stiffer prices this month despite the drop in benzene and cyclohexane (CX) values, according to sources on Wednesday.

Buyers lament that they are seeing triple digit increases in March even though the benzene contract price for the month by €46/tonne. One buyer said it had had to pay between €50-100/tonne more than in February for freely negotiated material, while another large purchaser stated that it had been obliged to pay €150/tonne more this month.

Prices have been surging ahead in the European adipic acid theatre chiefly because of a very tight balance of the market. While one buyer acknowledged that it had no choice but to accept significantly higher prices, another commented that values were now “far above our budget” with consequent question marks over its ability to continue purchases, at least on the desired scale.

A buyer said it was considering sourcing product from outside Europe, specifying China as a possible source. But another converter echoed other players in blaming current tightness in the European  arena mainly to a curtailment of imports from China.

In February, adipic acid prices rose by an estimated average of €250/tonne for freely negotiated contracts, taking gross numbers to above €2,000/tonne FD (free delivered) before discounts. However, substantially lower prices are still available, especially in the formula contracts, which have not seen as dramatic a rise in recent months.