Benzene prices take plunge in late March, nylon may retreat later

Benzene prices across region plunged across markets in Asia, Europe and US in the last week of March 2019. Asian benzene prices declined following a strong performance recently as market attention returned to weak Chinese demand. The start-up of Hengli Petrochemical and restart of Fujian Fuhai Chuang No 2 line fueled concerns that supply will increase significantly in China in near term. In Europe, benzene spot price were down on weak sentiment in Asia, and lower US prices. Asian supply glut also exerted pressure on US spot prices to plummet while disruptions at Houston Ship Channel impacted export cargoes.

Caprolactum spot markets in Asia were firm on modest demand and tighter supply while offers for liquid materials in China were hiked while those for flake goods generally rolled over. Contract prices were raised by major producers as supply will tighten due to upcoming turnarounds. In Europe, March contracts were settled between rollover and increase, giving producers some relief, as margins had narrowed by rising raw material costs contrasting with weak consumption.

Nylon or polyamide chip prices in Asia were flat to soft supported by firming feedstock and in turn reducing losses while overall market sentiment was steady seeing downstream mills follow up at low prices. Conventional spinning chip values were flat in China while high-end high-speed spinning chip were down. In Europe, March contracts for nylon 6 were mostly agreed at rollovers, with few cases of increases while nylon 6,6 contracts settled at rollovers and decreases.

Nylon filament (NFY) prices were firm in Asia, supported by stable chip costs and firming caprolactum costs. In China, demand was stable as warp-knitting, weaving and AJ covering units operated at stead rate while, circular-knitting and lacing mills operated at 50% rate. In India, nylon filament prices remained unchanged at the moment.

Excerpts from Global Markets Weekly Review report of 29 March