Editor Heng hui, hui.heng@icis.com

       NOTE: For full details on the criteria ICIS pricing uses in making these price assessments visit www.icispricing.com and click on “methodology”.

Market Summary

Market values for adipic acid cargoes in northeast Asia were stable-to-firm amid tight supply due to production cutbacks in Asia and Europe. This was further exacerbated by high demand following the onset of the peak manufacturing season in September.

Helped by stable conditions in the downstream nylon market and better demand in the polyurethane sectors, adipic acid suppliers stood by offers at $1,900/tonne CFR NE Asia.

Inventories were low. Imports had drastically decreased in China since the introduction of security deposits on adipic acid imports from the end of June, after a preliminary investigation showed that the United States, the European Union and South Korea dumped cargoes into the mainland, from statistics released by the Chinese customs.

Deep sea cargoes were scarce as prices in Europe were higher, sellers said. August contract prices in Europe were at €1,455-1,525/tonne ($2,109-2,210/tonne) FD NWE. 

Buyers and sellers agreed the outlook for September was bullish, though views were not optimistic for October when downstream producers traditionally begin to slow down operations for the year end stock take.

Upstream benzene bid-offer levels in Asia were heard at $790-820/tonne FOB Korea on Wednesday morning, up $10/tonne from Tuesday.

Spot

Adipic acid prices were assessed notionally stable at $1,800-1,900/tonne CFR NE Asia on the back of prevailing buy-sell ideas. Producers stood firm with offers at $1,900/tonne CFR NE Asia, but received buying indications from $1,800/tonne CFR NE Asia.

Taiwanese buyers also confirmed spot cargo price discussions levels were at $1,850-1,900/tonne CFR Taiwan this week.

The sole Korean producer reported domestic sales at $1,950-2,000/tonne Delivered Duty Paid (DDP), an increase of $150-200/tonne from the previous month's levels. The hike was successfully implemented as there were no other sources of adipic acid imports, the producer said.

In Southeast Asia, traders and producers reported selling at $1,850-1,900/tonne CFR SE Asia.

A producer cited sales of small volumes around 50 tonnes at $1,900/tonne CIF India this week.

In the domestic market, spot deals remained stable at yuan (CNY) 14,000-15,000/tonne ex-tank. Some Chinese buyers were heard to prefer imported material due to the perceived better quality over local product.

Contract

September contracts were largely concluded at $1,750-1,850/tonne CFR NE Asia, as confirmed with buyers and sellers. Cargoes of Korean origin were concluded at $1,750-1,800/tonne CFR China for September contracts, whilst a Taiwanese buyer reported September contract purchases at $1,800-1,850/tonne CFR NE Asia.

($1 = CNY6.83)

($1 = €0.69)

Production news:

Shandong Hongye Chemical Industrial Group Co Ltd is currently running its 140,000 tonne/year adipic acid plant in northern China at half its capacity after a maintenance turnaround in end-July.

Dushanzi Tianli High & New Tech Co is expected to start commercial operations at its newly built 75,000 tonne/year adipic acid facility in Xinjiang, northwest China in early-to-mid October, a company source said.

This week in ICIS news ( www.icis.com):

04-Sep-09 23:59 Europe BPA producers seek €30-90/t hikes despite benzene drop

04-Sep-09 17:35 Europe Sept FCA styrene down €100/t after barge contract fall

04-Sep-09 09:51 Formosa Chem shuts phenol-acetone plant on feedstock dearth

03-Sep-09 13:21 Europe Nylon 6 buyers threaten shutdowns over Sept discussions

03-Sep-09 11:39 Europe Sept Caprolactam negotiations likely to be prolonged  

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