Recently, international oil prices have hit new peaks continuously. The prices of pure benzene and caprolactam have continued to rise, and the price of nylon 6 chips has risen by more than 1,000 yuan/ton compared with that in February. Highsun Synthetic Fiber Technologies Co., Ltd believes that the upward trend will not end in the short term, and orders should be placed decisively when they are just needed. However, it is just a suggestion, you should make the decision by yourself.
1. The price drop of nylon 6 chips ends
Taking the bright nylon 6 chips (cash) in Zhejiang, China as a reference, since September 2018, the long-term decline in the price of nylon 6 chips has ended in April 2020, and is currently in a horn-shaped diffusion upward channel.
Affected by the US storm, oil prices are strongly supported, and China's two lines are overhauled, which intensifies the shortage of caprolactam supplies. The world economy is complex, monetary easing and liquidity are sufficient, and the price index of bulk commodities PTA and plastics has a strong rise. It is expected that the price trend of nylon 6 chips will be more positive in the later period.
2. The price difference between nylon 6 chips and caprolactam
The price difference between nylon 6 chips and caprolactam is at the second lowest level in history. The price increase of nylon 6 chips lags behind that of caprolactam and nylon 6FDY filaments. The inventory is steadily decreasing and is at a historical low state. Most of the polymerization plants basically stopped quoting due to the severe shortage of caprolactam supply.
3. Sufficient capital flow in the downstream textile and garment industry of nylon 6 chips
With the signing of the RECP agreement, the United States temporarily abolished tariffs on US$370 billion in Sino-US trade. BOC Macro believes that China’s foreign trade exports are likely to be strong in 2021. In 2020, financial regulation has vigorously supported textile and apparel companies, and the number of listed companies in the whole year reached 18, which is the most in history. The downstream textile and apparel industry of nylon 6 chips has sufficient capital flow, and the rising market has been confirmed. The momentum for stocking up in March should not be underestimated.
Post time: Feb-21-2022