Nylon yarn price will continue rising in June on favour […]
Nylon yarn price will continue rising in June on favourable demand
Nylon yarn price will remain lifted in June this year supported by favourable downstream demand and converters operating a steady run rates amid strong buying appetite. Demand has been strong for nylon since the past few weeks FDY, DTY and POY. Upstream nylon or polyamide chip prices will also trend up in June as caprolactum spot and contract markets are expected to remain elevated. Demand was also improving as operating rates were higher at nylon yarn producers amid positive margins.
In Europe, nylon 6 market will be quiet in June and prices may go up as benzene contract monthly price were settled up from May. Nylon 6 contracts had settled steady for May amid balanced fundamentals. Nylon 6,6 May contracts however, settled at increase from following increasing tight availability and rising costs. With both upstream, butadiene and benzene contracts up for May, will asserted further upward pressure on the nylon 6,6 markets in June as it continues to remain constrained by tight supply. Thus, downstream nylon yarn markets will also remain supported and prices may go up also due to improved demand.
In US, nylon 6 and 6,6 markets will continue to face upward pressure from strong demand coupled with global supply constraints. Ongoing shortages associated with firm raw materials and other production issues, primarily in Europe, will push prices up amid rising buying interest for nylon 6.
Caprolactum prices may pick up June in Asia as supply will be tight due to low run rates. Support from benzene market cannot be ruled out in June despite some disconnection seen in recent months. Downstream demand is expected to remain modest and not fall in June.
European May caprolactum contracts settled at increase from April, following rise in benzene costs and balanced fundamentals. Participants agreed to share benzene costs for May, seeing healthy demand at this time of year. Caprolacum buying appetite is also seen as healthy in June, with downstream nylon 6 units running well. However, demand tends to soften slightly in Q3 coinciding with the summer season in July and August.
By December, nylon chain prices will tend to ease and may remained below year ago levels. Currently they are 27-28% up YoY while raw material, caprolactum price have moved rapidly by 34%.