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Insight | Time: Apr 13 2017 4:09PM
USD nylon market stays at a high level
 
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RMB CPL and nylon 6 chip markets slumped in mid and late Mar, and RMB nylon 66 chip prices had also been bearish for over one month. However, USD CPL, nylon 6 and nylon 66 markets stayed at a high level.


USD CPL market: there were many turnaround plans, and sellers were reluctant to lower offers.

In Europe, Netherlands Fibrant’s two CPL units with capacity of 260kt/year in total shut down for maintenance due to Force Majeure on Mar 30, and the restart time was uncertain. Thus, supply from Europe was bound to decline in the next one or two months in Asia. Besides, Korea CAPRO’s one 150kt/year CPL line was expected to shut down for maintenance from May 6 to May 26, and Japan UBE’s one 90kt/year CPL unit was planned to shut down for maintenance for one month in end-Apr. Taiwan Sinopec’s one 100kt/year CPL unit was expected to shut down in late-Apr and restart in mid-May. As a result, USD CPL supply would reduce evidently in Apr and May, and it was unlikely for sellers to lower offers.


USD nylon 6 HS chip market changed according to fundamentals.

USD CPL prices were evidently higher than RMB CPL prices, and nylon 6 chip prices mainly followed the changes of CPL prices. Thus, USD nylon 6 chip prices were also higher than RMB prices. Particularly, nylon 6 HS chip prices in Taiwan were obviously higher than RMB chip prices. Besides, the operation rate of chip plants also reduced recently in Taiwan as USD CPL supply of Taiwan Sinopec and other enterprises decreased. The average operation rate was lower than 50% in Taiwan at present. Thus, USD CPL market would stay firm in short, but there were rare trades at high prices for USD chip market.


Nylon 66 chip market: USD nylon 66 chip market did not rise or fall as quickly as RMB market, and USD market was still supported by costs.

RMB nylon 66 chip market had continued dipping since Mar, but USD market kept rising. Nylon 66 chip prices had followed the increases of feedstock adiponitrile and adipic acid market from the fourth quarter of 2016 to Mar 2017, but there were differences between USD market and RMB market. RMB nylon 66 chip market went up rapidly supported by surging RMB nylon 6 chip market. But USD market rose slowly and only increased evidently since Feb 2017. RMB nylon 66 chip market was bearish recently due to sluggish nylon 6 chip market. But USD nylon 66 market did not rise as quickly as CPL market previously, so nylon 66 market was still firm at present. For absolute prices, USD nylon 66 price at $2,800/mt was converted into RMB price at around 24,000yuan/mt, which was reasonable compared with RMB nylon 66 chip price at around 23,000yuan/mt.


*Note: HS- high-speed spinning
    CS- conventional spinning
[RISK DISCLAIMER] All opinions, news, analysis, prices or other information contained on this report is provided by analyst of Zhejiang Huarui Information Consulting Co., Ltd (CCFGroup) as general market commentary and does not constitute investment advice. CCFGroup will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.
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