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DOMO EXPANDS TECHNYL® PRODUCTION IN CHINA
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DOMO expands TECHNYL® production in China. DOMO Chemicals has opened a new TECHNYL® polyamide plant in Jiaxing, China.

The facility responds to the surging local demand for engineered materials. With a €14 million investment, the plant’s capacity could reach 50,000 tons.

This expansion doubles the existing capacity to better serve key industries. The Jiaxing plant will primarily supply the automotive and electronics sectors.

It also aims to support the growing markets for green energy and mobility. CEO Yves Bonte emphasizes the importance of staying close to customers.

The plant spans 40,000 square meters, featuring state-of-the-art technology. Since 2016, DOMO has significantly increased its footprint in China. The new facility underscores DOMO’s commitment to sustainable, high-quality solutions.

Following the acquisition of Solvay’s business in 2020, DOMO now exclusively produces and distributes TECHNYL®, featuring both PA6 and PA66 solutions.

NYLON PRICES SPIKE SHARPLY IN MARCH 2024
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Nylon prices spike sharply. In March, European PA6 and PA66 prices rose, driven by higher costs, but hampered by weak demand and ample supply. Suppliers face margin challenges.

Price hikes vary, with success in lower-priced accounts. High-end accounts struggle, leading to price rollovers amid cost pressures and competitive dynamics.

For example, PA6 prices surged by €100/MT, according to GC Intelligence price assessments.

This highlights the strain on suppliers. Some buyers faced even steeper increases, amplifying the challenge in a tepid market.

Forecasting remains cautious, with April and May expected to see continued cost pass-through efforts. Weak demand and the Suez Canal situation limit price hikes.

Demand is low across markets, briefly uplifted by restocking. High interest rates impact construction, and the automotive sector shows flat demand.

The supply remains ample despite import delays. Cost pressures, such as rising benzene and caprolactam prices, challenge suppliers pushing for significant price hikes.

INSIDE THE TURMOIL OF EUROPEAN ENGINEERING RESINS
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Inside the turmoil of european engineering resins. March has introduced new difficulties for sellers in the European engineering resins market.

Demand continues to be weak. Prices for critical resins like polycarbonate (PC), polyamide 6 (PA6), and polyamide 66 (PA66) have increased.

These price hikes result from elevated costs and diminished import competition. Despite this, there’s a consensus that the upward price trend might soon plateau.

Suppliers are finding it challenging to transfer these increased costs to buyers. In the case of PC, many are opting for price rollovers.

For nylons, the price increases are less than anticipated. The February panic, triggered by unrest in the Middle East, has subsided.

Market sentiment now mirrors January’s, marked by low demand and challenges in volume movement. Rising costs are now an additional burden, squeezing margins even further.

The market is shrouded in uncertainty, particularly regarding future pricing. Price reductions seem improbable, given the onset of peak seasonal demand in some markets and reduced import competition.

Yet, the impact of higher costs may negate any benefits from price increases.

Sales volume remains a critical challenge. This ongoing issue has prompted, and is likely to continue prompting, restructuring within the industry.

The persistence of these conditions reflects the complex dynamics at play in the European engineering resins market.

EU CAR SALES JUMP 12.1% IN JANUARY 2024
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EU car sales jump 12.1% in January 2024, according to the latest data from The European Automobile Manufacturers’ Association (ACEA).

A total of 851,690 vehicles were registered. This marked a significant rebound from the slow pace observed in the previous month.

Key European markets, including Germany, Italy, France, and Spain, all reported substantial increases in car registrations. These figures illustrate a broad-based revival in auto demand throughout the region.

Electric vehicle (EV) market share climbed to 10.9%, up from the previous year, indicating a growing consumer shift towards electric mobility.

Hybrid vehicles also saw a rise in popularity, accounting for nearly 30% of new car registrations, while traditional petrol and diesel vehicles experienced a decline in market share.

Electric car sales experienced a robust increase of 28.9%, with 92,741 units sold. This surge was led by significant growth in major markets such as Belgium, the Netherlands, France, and Germany, highlighting the increasing appeal of EVs among European consumers.

The surge in hybrid vehicle registrations by 23.5%, along with a 23.8% increase in plug-in hybrid sales, reflects a continuing trend towards electrification in the EU automotive market.

However, while the automotive sector shows promising growth, the polymer industry reports stable but unenthusiastic demand.

Specifically, polymers like PA6, PA66, and polycarbonate (PC) are facing challenges related to good availability within the value chain, as overall demand in Europe remains tepid.

European PA6 and PA66 Markets in February 2024: Responding to Import Disruptions
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European PA6 and PA66 markets: The PA6 (Polyamide 6) and PA66 (Polyamide 66) markets in Europe are experiencing a notable shift as a result of the ongoing Middle East crisis, which has disrupted import activities.

The complications arising from delayed shipments and escalated freight rates are imposing additional costs and risks on buyers, who are increasingly turning towards domestic suppliers for their needs.

This pivot is notably rejuvenating the demand for PA6 and PA66, steering it away from the record lows observed in December and January.

Revival of Demand Amidst Supply Chain Constraints

Historically, the demand for these polymers had plummeted to unprecedented levels, heightening the risks of plant shutdowns and prompting concerns over potential industry consolidation. However, the current reduction in imports is inadvertently bolstering European suppliers, enabling them to elevate prices and recuperate some of their eroded margins. This development is particularly timely, considering the precarious position suppliers found themselves in at the year’s outset.

At the beginning of the month, it was clear that prices in the European PA6 and PA66 markets lacked traction. Suppliers faced significant challenges in attempting to raise prices, a situation compounded by the overall low activity across most downstream markets. Despite these hurdles, there are indications that some price increases are beginning to take hold. This trend is more evident for accounts that previously benefited from lower-priced imports, which are now seeing price hikes in the triple digits.

Raw Material Costs Bolstering Price Increase Justifications

The justification for these price adjustments is further supported by the rising costs of raw materials such as caprolactam and benzene in Europe. These increases in input costs provide suppliers with a solid argument for the necessity of price hikes. It is worth noting, however, that the extent of these increases remains constrained by the subdued activity in downstream markets, indicating a complex balancing act for suppliers.

In summary, while the European PA6 and PA66 markets continue to grapple with the challenges posed by the Middle East crisis and its impact on imports, there are signs of recovery and adaptation. Suppliers are strategically leveraging the situation to mitigate previous losses, albeit within the limits imposed by current market dynamics.

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