Nylon filament yarn prices moderate but benzene rebounds
Nylon filament yarn prices were seen moderating in Asian markets in the week ending 13 April on easing cost support in recent weeks. The week saw benzene prices rebound slightly which will support nylon yarn markets in coming weeks through caprolactum.
Benzene prices in Asia rose on the back of firmer demand and rise in crude oil prices. Benzene supply was in China was ample which limited further rise in prices. In Europe, benzene prices moved up on strength in energy market amid escalating geopolitical tensions. In US, spot benzene prices decreased at the high end as prompt and forward month spot trade prices averaged lower. Liquidity was thin for prompt month but increased midweek on higher crude prices while forward-month liquidity was steady. Asian benzene markers inched up US7 a ton week on week while European spot rose US$17.50 a ton FOB Rotterdam and US$11 a ton CIF ARA.
Asian caprolactum markets remained insipid and spot prices weakened further, but contract nominations were still high. Demand was thin with buyers on the sidelines. In Europe, negotiations continued in the caprolactam market with most players still unable to agree on price with unchanged pricing pressures. As monthly benzene contract price for April dropped, many caprolactum buyers were targeting decreases in line with the movement. Asian caprolactum markers fell US$30-40 a ton CFR SE/FE Asia while in China, spot prices for flake and liquid goods moderated US$90 a ton.
Nylon chip markets were weak amid cautiousness in China while offers from Taiwan were adjusted as demand was modest from nylon yarn producers who maintained run rates due to decent margins in textile sector. Buying sentiment was cautious for chips since feedstock market was lukewarm and buyers were more in a buy-rise mentality. In Europe, April contract negotiations in nylon 6 market started with rollovers to decreases from March, while negotiations for nylon 6,6 began with increases following tightness and high demand.
Nylon filament yarn prices moderated further as benzene markets were insipid and caprolactum spot market weakening. Soft chip market was leading to downward corrections in yarn market, and thus discounts were offered aggressively. Downstream textile producers operated at modest rates as actual demand declined slightly due to thinner buying interest, increasing buy-rise mentality and fewer new orders. Nylon-6 FDY prices dipped on the back of insipid chip market and cautious demand while nylon-6 DTY prices remained range bound. Warp knitting mills and covering mills were operating at 70-90% of rates, while circular knitting mills and lacing mills were running at 50-70%.
Source: Global Markets Weekly Review
