Envalior's Technical Problems in Polyamide 6 Plant Triggers Force Majeure on Caprolactam Production
Envalior's Technical Problems in Polyamide 6 Plant Triggers Force Majeure on Caprolactam Production

Envalior's Technical Problems in Polyamide 6 Plant Triggers Force Majeure on Caprolactam Production

  • 20-Sep-2023 6:19 PM
  • Journalist: Francis Stokes

Envalior, a prominent global engineering materials solution provider based in Cologne, has taken a significant step in response to technical problems at one of its pre-production plants involved in the Polyamide-6 production process located in Antwerp. Specifically, Envalior declared a force majeure event on its Caprolactam production, effective as of September 1, 2023, at its Antwerp facility. This declaration signifies that Envalior is unable to fulfill its Caprolactam production obligations due to unforeseeable and uncontrollable circumstances, likely stemming from the technical issues at its Antwerp plant. This declaration implies additional limitations for the downstream Polyamide 6 (PA6) production in both Antwerp and Uerdingen. However, it's worth noting that there is an adequate supply of Polyamide 6 base polymer in the warehouses. This supply ensures the continued provision of compounds to processors and helps avoid any force majeure declarations on the polymer itself. The situation highlights the importance of maintaining stable and reliable supply chains in the chemical industry.

Despite the production issues in the Polyamide 6 production route in Antwerp, the product's cost remained stable in the Eurozone area at the beginning of September. Subsequently, the Polyamide 6 market saw a modest improvement, following a period of stability that extended until September 15, 2023. This improvement can be attributed to the ongoing high-cost pressures from raw materials in the Eurozone market. However, it's important to note that the demand from the downstream textile industry has remained relatively unchanged and has not exhibited significant fluctuations over the past seven days. This stability in demand can be attributed to the influence of high-interest rates, which have dampened demand within the textile industry. These market dynamics highlight the intricate relationship between raw material costs, interest rates, and demand patterns within the Polyamide 6 market in Germany.

In the recent period, there has been a persistent and notable decrease in new orders, and this decline has intensified when compared to the situation in July. This means that the rate at which new orders decrease has recently picked up. Moreover, the decline in new export orders has been particularly significant, especially regarding reduced European sales.

The price of Polyamide 6 in Hamburg stood at approximately USD 3930/MT on a DDP basis, with a weekly increase of 0.7% noted during mid-September 2023.

Polyamide 6 and Caprolactam prices in the European market are expected to experience an upward trend, primarily driven by the increasing costs of raw materials like Benzene and crude oil. There is currently no available information regarding the duration of this FM on Caprolactam.

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