15 June 2010
Nylon 6 prices are now declining in China, after significantly rising in the past 15 months. A weaker demand from the textile industry and lower raw material costs are behind the change in long-term trends on the polyamide market.
Nylon 6 prices began declining in the first two weeks of June in China after reaching an annual high by the end of May.
Filament prices fell about 500 yuan per metric ton in the last three weeks, with benchmark DTY 70D/24f sliding from 30,000 yuan per metric ton down to 29,500 yuan.
This slight fall of 1.7% follows a nearly continuous rise since the first quarter of 2009, as reflected in our historical graphs below.
Nylon prices are actually back to their long term level in China after sharply dropping in the second part of 2008.
They may however continue sliding in the coming months, as demand is slowing down from textile processors who were not able fully passing the recent rise in prices on to their customers.
Raw material costs of nylon producers are also declining, at the same time.
A sharp drop in benzene prices resulted in a similar decrease in caprolatam prices on the global market.
CPL prices were down from US$2,720 to US$2,600 in the past weeks, on the international market.
In China, CIF import prices fell from US$2,610 down to US$2,490 in the first two weeks of June.
The global CPL market is heavily dependent on the level in demand from China.
China's nylon production sharply rose in the past years, as reflected by our series of tables below.
CPL production did not really follow the same trend, leaving China's demand for foreign caprolactam still accounting for 65% of total domestic use.
By contrast, total nylon production in China (including 6,6 nylon) accounted for 93% of domestic use in the past year, up from 80% in 2005.