For the Quarter Ending June 2021
During Q2 2021, Polyamide supply outlook in the North American market remained tight owing to limited availability of the upstream feedstocks, while Nylon 6,6 producers were extremely anxious over low production of Adipic Acid. Lower production of Caprolactam kept the supplies of the Nylon 6 lesser than anticipated. Furthermore, the short supply situation was exacerbated by turnaround at several plants in the region, which resultantly hiked the regional offers Polyamide. The pricing continuously rallied upwards taking FOB Texas discussions to USD 3720 per tonne in June for Polyamide 6. The demand was exceptional from the downstream industries, as the construction sector witnessed the seasonal hike throughout the quarter, and the consistent surge in enquiries from the automotive sector and daily household uses.
During the second quarter, supplies of Polyamide in the Asia Pacific region showcased mixed trends as the limited availability of the upstream Caprolactam restricted the production of the Nylon 6 and Nylon 6, 6 in the regional domestic market. Whereas in China, the consumption taxes imposed on the imports of mixed aromatics commodities and rising inflation rate in the Chinese domestic market exacerbated the tightness of the Polyamide resins. Subdued market activities in India due to the impact of second COVID wave made spot buyers reluctant to procure large volumes which maintained stagnancy over the Indian Polyamide offers throughout the second quarter. Ex-Works Mumbai (India) prices were assessed at USD 3226 per tonne and USD 2957 per tonne for Nylon 66 and Nylon 6 extrusion grade respectively in June.
In the European market, the overall supply of Polyamide remained constrained during the second quarter of 2021, owing to planned and unplanned turnarounds at various Nylon 6 facilities in Q2. Production issues were reported due to the severe shortage of the feedstock Caprolactam in the regional market. Demand was exceptional from the downstream market as the region observed a seasonal hike in demand from the building and construction industries, and the offtakes were also consistent from the electronics and textile industries to cope up with the economic rebound. Due to the supply demand imbalance, Polyamide prices remained on an uptrend throughout the quarter.
For the Quarter Ending March 2021
Most of the production facilities in the USA Gulf region were forced to temporary shutdown in mid-February as the regional infrastructure collapsed amid the severe freeze weather conditions which led to limited availability of the upstream feedstocks. Hence, the supplies witnessed significant downfall amid the healthy-to-strong demand from the downstream industries. BASF hiked the prices of Polyamide by +USD 530/ton for the April delivery in the North American region.
The Asian Polyamide market remained constrained amid short supplies during the Q1 2021, majorly caused by the lack of key feedstock caprolactam as the regional plants were operating at reduced efficiencies. Demand during the first quarter was upbeat as several Chinese buyers started replenishing their inventories ahead of Chinese lunar new year holidays, though constant consumption from the automotive players kept the prices phenomenally high across the Asian markets. FOB prices of Polyamide 66 were averaged USD 6450 per MT in China, with the graph maintaining the upward trajectory for a larger part of the quarter.
Severe cold weather in the northwest European region tightened the Polyamide supplies during Q1 2021. Whereas several major plants were operating at reduced capacity due to the unavailability of key feedstocks and raw materials amid the transportation hiccups throughout the region. The demand however surged due to improved consumption from the downstream automotive, construction and textile sector. Reduced imports from the USA led to the spike in the prices of Polyamide in European region.
For the Quarter Ending September 2020
The Asian Polyamide market remained muted in the quarter ending September due to depressed demand for finished goods. Market players seemed divided over the regional outlook during the quarter. Producers maintained low operating rates as they saw almost no need to ramp up production considering the demand slowdown. Downstream manufacturing run rates were curtailed amid slow end-use consumption forcing Chinese factories to operate at an average of 65-75% to balance their inventory levels. Nylon chip imports in China slipped in Q3 as the summer months posed a typical lull period for the market while some market players stood hopeful that the market may see active restocking ahead of the long holiday in early October. With players offering hefty discounts, spot discussions for polyamide chips were heard trading around USD 1200-1300 per tonne CFR China in mid-September.
Outages due to hurricane Laura were heard impending little to no effect on the supply of US nylon 6 and 6,6. US’ polymers and fibers giant INVISTA temporarily shut operations at its Texas facility ahead of Hurricane Laura but the turnaround had a limited effect on the regional supply. Nylon demand in the region maintained pace with the downstream construction and automotive sector which showed signs of revival in the third quarter after witnessing a major slump in Q2. Some producers preferred to operate at curtailed rates knowing that the sector would get back to normalcy only in 2021. Players report that the demand for construction applications has been on a rise backed by strong demand for Nylon films for food packaging. This remained indicative of the improved outlook for Q4 compared to the Q3 levels, which however remained still below the previous year’s levels.
Downstream buying which got affected due to lacklustre automotive demand showed gradual recovery in Q3, allowing some producers to ramp up their Nylon-6,6 production outputs. Players maintained a cautious stance amid looming market uncertainties as the number of cases resurge strongly in Europe, raising fears of the second coronavirus wave. Moving into September, buoyant demand for engineering plastics, helped in fetching high volume orders with sales figures outperforming September 2019 for some producers. Contract prices for industrial grade Nylon 6,6 oscillated between rollovers and decrease, settling around USD 4650-4670 per tonne NWE in September. However, market took off from the ground levels as Nylon consumption in textile applications gained strength for a number of household products backed by growing demand from the apparel sector for new seasonal collections ahead of Christmas and New Year.