Price increases for the window sector owing to extreme scarcity of Polyamide 6.6?

The impact on the Chinese market of force majeure at Solvay and BASF in Europe

 The extent to which today’s economy is globally linked and individual events can have an impact on entire industries is demonstrated by the current shortage of the thermoplastic Polyamide (PA) 6.6, which is used for the production of engineering plastics. These engineering plastics are used in a variety of industries for the manufacture of products that must satisfy exacting standards in terms of mechanical strength or thermal resistance. The German manufacturer Ensinger, for example, uses PA 6.6 in the production of insulbar® insulating profiles for window systems. The high-performance engineering plastic TECATHERM 66 GF, which makes the insulating profiles extremely resilient to influences of environment and climate, is mainly based on this plastic PA 6.6. Owing to current events, Ensinger is now, like many other plastics-processing companies, facing a Polyamide 6.6 sourcing problem.

Ensinger is exhibiting:

23. – 26. October 2018
Düsseldorf, Germany

13.-16. November 2018
Madrid, Spain

14.-19. January 2018
Munich, Germany

High-performance plastics such as the TECATHERM series from Ensinger are made from, amongst other things, Polyamide 6.6. They feature good mechanical properties, chemical resistance, wear resistance and outstanding machining properties and dimensional stability. (Picture credits: Ensinger GmbH, Germany)

Force majeure at Solvay and BASF

It all began in January 2018 when Solvay, a producer of chemicals and high-performance materials in Belgium, announced technical problems in the production of PA 6.6. Shortly afterwards, the world’s biggest chemical company BASF announced with dismay the breakdown of the HMD production facility at the British Ineos plant, the facility on which the base polymers and compounds for the production of PA 6.6 are made. At that time there was also already a supply bottleneck regarding adiponitrile (ADN), a base material for the production of the PA 6.6 base polymer. After the facility at BASF had briefly been up and running again, at the end of May of this year an electrical fault resulted in another failure of the HMD facility which has still not been resolved.

Supply bottlenecks and price increases in Europe and China

The European industries are now starting to feel the effects of this disastrous combination of technical problems and supply bottlenecks. The raw materials are scarce, there is the threat of allocations and supply prices are exploding. Companies like Ensinger who are reliant on PA 6.6 to maintain the quality and performance of their product, have no choice but to accept the changed situation. This means that the constantly evolving, dramatic price increases possibly must be partially passed on to their own customers.

This also applies to China. This is because the Chinese market purchases a large part of its PA 6.6 from the few European or American companies which produce the polyamide or its precursors. Unlike the lower-performance Polyamide PA 6, which is produced from other chemical precursors and in China is produced directly on a large scale, when it comes to PA 6.6 the market is reliant on imports. In all likelihood this will soon involve price increases for Chinese processing firms’ products too.

In the medium term there is no prospect of things getting easier, since what is more from the start of 2019 the only European ADN facility in France will be shut down for servicing for an undefined period of time. It therefore cannot currently be predicted when the sourcing situation will return to normal.