PA66 – The Pressure Grows

The situation and problems surrounding nylon 66 have been well documented over recent months, however it now seems that the issues may well get worse before they get better?

The inexorable rise in prices started back in early 2016, predominantly on the back of increasing demand and higher costs for other similar polymers and shared raw materials. Since then, the market has seen numerous price rises as well as Force Majeures for both PA66 base polymer and key raw materials such as adipic acid, butadiene (BD), acrylonitrile (AN), hexamethylene diamine (HMD) and adiponitrile (ADN).

Of course, some of this has been the key producers ‘restoring’ margins and could be seen as opportunistic, but the reality is that the price increases have been large and numerous and overall the market now looks very different to where it was 2 years ago.

The latest information is that butadiene is once again rising in cost very rapidly in Far East and US markets with Europe not far behind. For instance last week it was reported that the European butadiene (BD) contract price for June has been agreed at €1,150/tonne, up by €140/tonne from May. This is the highest contract price settlement since June 2017. An increase from May was widely expected on the back of tight supply and strong demand which had pushed spot prices well above May levels, and this, combined with higher upstream naphtha costs means that BD prices will almost certainly continue to rise still further.

Where all this ends up is anyone’s guess? However the very real possibility now is that with the PA66 market ‘overheating’ many users and specifiers may well be forced to ‘down spec’ applications wherever possible, with the major winners potentially being for example nylon 6 and/or higher performance PP grades. Whatever happens it continues to be a very interesting time for nylon 66.