Spot Caprolactam prices in Asia dip below $2200/MT in late June 2012

Dualloy Engineering Polymers Ltd. – Plastic Scrap Recycling
Nylon 66 – PA66 Off-Grade / Wide Specification Pellets
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I have just gotten back from a week in China, so I thought I would let you know what I saw in regards to business during my travels.  The Chinese economy is slowing down significantly, but mainly because export sales to the USA and Europe are off at this time.  China will see 6-7% growth in 2008, but that is down 50% from its 15% annual growth from 2000-2009.  Most of the businesses that I visited said that their business was off by 40-50%.  Most buyers anticipate that material prices will move down in June and July, so they do not want to place any orders in the month of June.  Most of the Asian traders are in panic mode, and are just trying to sell off their inventory before material prices go down further.  This panic selling is not helping when trying to secure export sales orders, because no customer wants to lose money on August deliveries, for resin that they purchased in June.  The price of Nylon 6 is softening weekly due to the price of Caprolactam falling significantly over the past 60 days.  Now the price of PA66 regrind is being challenged by the lower prime PA6 prices.  Caprolactam is selling this week in the spot market in Asia below $2200/MT, which should translate into prime PA6 fiber chips selling around $1.06-1.08/lb. CIF the Port Asia.

The Asian housing market has been correcting since the beginning of 2012, with home sales prices falling in most major cities.  China’s housing market is somewhat like ours in the USA, some areas of town see their prices stay flat or increase, while other parts of town see significantly lower home sale prices.  Don’t’ get me wrong, most houses in China have a lower sale price, but not all.  The Chinese car market is starting to normalize after 9 strong years of sales.  The private ownership of cars in China just started in 2003. Their initial car sales boom has come to an end, and the market is starting to develop into a more normal supply and demand driven market.

In order to stimulate the economy the Chinese central government is starting to initiate some domestic stimulus programs to support the continued growth of the country’s infrastructure.  They will continue to expand their rail and highways systems into the Western part of the country, and build more subways in the big cities.  The government will lower the interest rates for loans from the central Bank of China, and lower the cash reserve rate to free up more money for lending.  But what company needs a cheap loan if you don’t have any orders on hand, so you can run the factory?

We think that China will remain slow through the end of 2012, or until we see some real increase in product demand out of the USA and Europe.  We feel that business will be very slow in June and July 2012, and material prices should bottom out sometime in July.

Dualloy Sells Nylon 66 – PA66 Off-Grade (wide-specification) Pellets / Regrinds

Dualloy sells the following Nylon 66 (PA66)  / Nylon 6 (PA6) materials:
Nylon 66 Bright w/HS Off Grade Pellets
Nylon 66 Semi Dull Off Grade Pellets
Nylon 66 Dull Off Grade Pellets
Nylon 66 Off-Grade Textile Bright Pellets
Nylon 66 Off-grade Pellets w/ up to .02% TiO2
Nylon 66 Mixed Color Regrind
Nylon 66 Bright Regrind from Lump/Chunk
Nylon 66 Semi Dull / Mixed Luster Regrinds

Prime Nylon 6 Pellets 2.7 RV – Bright
Packaged in 1,500# boxes
Fibers / Compounding Feedstock

Dualloy sells the following types of Nylon 6 Polymer production waste:
PA6 Kettle Bottoms
PA6 Capro Residue
Call for MOQ and current material prices

Dualloy purchases / sells plastic and polymers in the following forms:
Aged / Obsolete Virgin Pellets
Wide Specification, Off-grade Pellets
Clean uniform plastic regrinds
Reactor Lumps/Chunks/Patties
Nylon Fiber Bales

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Nylon 66 Plastic Sales
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Nylon 66 Plastic Recycling Company
PVB Plastic Recycling – Polyvinyl Butyral
Chrome Plated Plastic Scrap Recycling

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One Response to Spot Caprolactam prices in Asia dip below $2200/MT in late June 2012

  1. Trupti Agrawal says:

    Hi James,

    Thanks for the first-hand insight of some of the sub-sectors of the Chinese economy. I have been tracking the Caprolactam market (prices, caprolactam-benzene margins, outlook for Nylon 6 etc.) Would be glad if you could share any other insight or outlook you may on the same (can you suggest where I can look up for this info)

    Thank you.


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