Introduction: In 2026, the domestic caprolactam market has been driven by a combination of geopolitical conflicts causing significant increases in upstream raw material costs and persistently low industry operating rates leading to a supply-demand gap. Consequently, prices have generally trended upward with volatility. The average spot price of caprolactam in the East China region from January to August reached RMB 11,526.98/ton, representing a year-on-year increase of approximately 20%.
Since the beginning of 2026, caprolactam prices have risen overall, supported by escalating costs and a tight supply landscape. From January to August, the average spot price in the East China market was RMB 11,526.98/ton, up about 20% year-on-year. Specifically, the market showed strong volatility in January and February, primarily due to improved supply conditions following enterprise production cuts initiated in November 2025, which allowed prices to gradually recover. After the US-Iran conflict, upstream crude oil and pure benzene prices surged sharply on single days in early March before pulling back; caprolactam prices followed this volatility, trending higher throughout March. Prices peaked at RMB 13,500/ton in early April but subsequently declined to RMB 10,900/ton by early July. This decline was driven by weak downstream demand response creating negative feedback transmitted upstream, alongside easing tensions in the Middle East. Later, rebounding costs and increased expectations for scheduled maintenance supported another price recovery. By early September, caprolactam prices exceeded RMB 14,000/ton. Currently, the East China spot price hovers around RMB 14,300/ton, with market expectations for continued upward movement this week.
Significant rises in upstream raw material prices have become the dominant driver of market trends.
Regarding pure benzene: Since March, recurring geopolitical news from the Middle East has caused intense volatility in the pure benzene market, with prices rising significantly overall. Entering April, as market speculation regarding crude oil and commodity news became more rational, price fluctuations narrowed considerably, with prices oscillating at high levels. During May and June, as Middle East tensions eased and downstream industries increased production cuts or halted operations, market sentiment weakened, pushing pure benzene prices into a downward channel. In July and August, concentrated maintenance of domestic pure benzene units and low port inventories tightened supply, driving prices to rebound again. By early September, Sinopec’s listed price for pure benzene was raised to RMB 9,900/ton.
Regarding sulfur: Geopolitical disruptions in the Middle East and obstacles to strait navigation drove international sulfur prices consistently higher. In 2026, amid intensifying supply-demand contradictions and declining imports and port inventories, spot sulfur prices exhibited a unilateral upward trend, repeatedly hitting historical highs. Starting in June, the "three major oil companies" directed domestic resources specifically to guarantee phosphorus fertilizer supply, tightening available commercial inventory and pushing market prices further. Sulfur prices at Zhenjiang Port peaked at RMB 11,750/ton before fluctuating downward in July and August.
Caprolactam supply remained at low operating rates in 2026, with a tight supply landscape also supporting prices.
In 2026, caprolactam enterprises mainly operated at low loads, with capacity utilization rates ranging from 70-80%, resulting in a tightening supply landscape. The cumulative supply-demand gap for caprolactam from January to August was approximately 80,000 tons. Low operating rates made tight supply a key characteristic of the market; during most months of the year, caprolactam faced oversubscription, providing support for price increases in line with costs.
Looking ahead, upstream pure benzene prices remain generally high, with Sinopec’s listed price staying elevated, maintaining cost pressure on caprolactam producers. In the short term, caprolactam enterprises may continue to raise prices in tandem with pure benzene. On the supply side, although the restart of Luxi Chemical’s Phase III project has slightly alleviated the supply landscape, Lu’nan Petrochemical’s unit is down for maintenance and Yangmei Taihua has not yet restarted, keeping overall caprolactam supply tight. Therefore, caprolactam enterprise prices are expected to maintain a bullish uptrend this week.
However, in the medium to long term, uncertainty surrounding Middle East geopolitics remains high, posing risks of wide fluctuations in crude oil and pure benzene prices. Furthermore, as raw material prices continue to rise recently, cost pressures on downstream PA6 chip and spinning enterprises have intensified. Procurement of high-priced raw materials by downstream sectors has slowed. With the Mid-Autumn Festival and National Day holidays approaching, weak downstream willingness to absorb high prices may impose certain constraints on the upward momentum of the raw material market.
Comments
0