Asian caprolactam hit a 2-year high on Thursday with the CFR Far East Asia marker assessed by S&P Global Platts at $1,830/mt.
The last time the price was at this level was on December 18, 2014, when the Platts CFR Far East Asia marker was assessed at $1,900/mt.
Tight supply resulting from capacity cuts in Europe and the US have reduced the availability of spot cargoes in Asia. Moreover, rising feedstock benzene costs in the past few weeks have led to a surge in caprolactam prices as buyers rushed to procure spot cargoes in anticipation of further hikes.
The sudden rise in demand and shortage of spot cargoes due to most of the material having been sold under long-term contracts led spot prices to rise quickly, a Northeast Asia buyer said.
A seller in Northeast Asia expressed surprise at the rapid rise in prices as Nylon 6 demand remained unchanged in December. "Besides, crude oil and Benzene prices are increasing. These raw material costs pushes up the caprolactam price," he added.
Most market participants said the rally in caprolactam prices could continue into the New Year. But a fall in benzene prices could stifle demand for spot caprolactam, they added.
FOB Korea benzene rose $294.50/mt or 52.9% year on year to $851/mt on December 15, according to Platts data.
