Caprolactam Market Review and Trend Outlook for H1 2026

Lead: In the first half of 2026, caprolactam market prices initially rose and then fell. The sudden change in the Middle East situation drove a sharp increase in upstream raw material prices, such as pure benzene and sulfur, pushing up the cost of the industrial chain, and caprolactam prices followed the cost increase. However, downstream demand was weak, and the high cost was hindered in its transmission downstream. Coupled with the later easing of the Middle East situation and the drop in raw material costs, caprolactam prices came under pressure and weakened.

I. Strong Cost, Weak Demand – Caprolactam Prices First Rose Then Fell

Table 1 Domestic Caprolactam Price Table (Unit: RMB/ton)

In H1 2026, the average caprolactam price in the East China market was 11,317.29 RMB/ton, up 1,478.96 RMB/ton year-on-year, an increase of 15%.

In H1 2026, the caprolactam market first rose and then fell. Cost increases provided the main upward support, while insufficient downstream follow-through created constraints. From January to March, the caprolactam market rebounded and rose, mainly supported by strong costs and continued coordinated production cuts by caprolactam enterprises. The overall operating rate of enterprises remained at 70-80%, providing positive support to the supply side. After March, affected by the situation in the Middle East, product prices in East China surged, and caprolactam prices followed the rise. By early April, the spot caprolactam price in the East China market rose to 13,500 RMB/ton (acceptance delivery). After late April, although costs remained high, downstream follow-through was weak, and the negative feedback from the demand side increased. The transmission of high-priced raw materials downstream faced significant resistance. Under the pressure of the tug-of-war between cost and demand, the caprolactam market fluctuated downward. By the end of June, the spot caprolactam price in the East China market was 10,900 RMB/ton (acceptance delivery).

II. Enterprises Continued to Reduce Operating Rates, Caprolactam Output Declined

Table 2 Caprolactam Output and Capacity Utilization Rate Change Table (10,000 tons, %)

In H1 2026, there was relatively little new caprolactam capacity, only the 60,000 tons/year expansion of Shanxi Yangmei. Moreover, enterprises continued to implement strategies of reducing operating rates and production cuts, leading to an overall lower caprolactam operating rate.

According to statistics from chempricehub Information, caprolactam output in H1 2026 was 3.25 million tons, a decrease of 130,000 tons or 4% compared to 2025. The capacity utilization rate for caprolactam was 73.71%, down 16.57 percentage points from H1 2025.

The cumulative import volume from January to May 2026 was 49,600 tons, a decrease of 18,900 tons or 27.61% compared to the same period last year. In terms of trading partners, China's caprolactam import sources were mainly Russia, with sporadic imports from other countries. Russia is currently a relatively fixed major source of caprolactam imports. Due to weak domestic downstream demand in 2026 and the occasional lack of price advantage for imported goods, caprolactam imports declined in 2026.

III. Lack of Improvement Momentum on the Demand Side, Caprolactam Demand Slightly Decreased

The downstream demand structure for caprolactam is relatively stable. PA6 still accounts for nearly 98% of caprolactam consumption. In the hexamethylenediamine (HMDA) field, with the successive commissioning of caprolactam-based HMDA units from Shenma, Xuyang, and Rongcheng, the consumption of caprolactam in this field continues to increase, although the volume scale is still relatively small.

According to statistics from chempricehub Information, the total caprolactam consumption in H1 2026 was 3.285 million tons, including 3.21 million tons for PA6 consumption, 16,000 tons for engineering plastics consumption, and 59,000 tons for HMDA consumption.

Regarding exports, the cumulative export volume from January to May 2026 was 62,700 tons, a decrease of 24,300 tons or 27.9% compared to the same period last year. In terms of trading partners, the main destinations were Taiwan (China), India, and Vietnam.

IV. H1 Caprolactam Supply-Demand Balance Changes

In H1 2026, the caprolactam product profit was -1,688 RMB/ton, and the unit profit was 505 RMB/ton. Looking at the profit change trend in H1, from January to April, the caprolactam unit profit was acceptable. After April, on the one hand, the price of upstream sulfur rose rapidly; on the other hand, the negative feedback from downstream demand increased, putting more pressure on the caprolactam market, causing profits to fluctuate downward. Coupled with the decline in the price of the by-product ammonium sulfate, caprolactam was overall in a loss-making situation in June.

Note: Production cost is calculated based on the unit consumption of raw materials such as pure benzene, sulfur, hydrogen peroxide, and synthetic ammonia. The production gross profit value is the profit for the caprolactam product alone and does not include ammonium sulfate income. The unit gross profit value includes ammonium sulfate income.

V. Caprolactam Price Forecast for H2

Cost Aspect: With the normalization of shipping through the strait, prices of crude oil, pure benzene, and sulfur are expected to fluctuate downward. The supply-demand balance for pure benzene is expected to remain negative in July, likely providing some price support. From August to December, previously idled pure benzene units are expected to resume, leading to an ample supply. The return of the supply-demand balance to positive values will put downward pressure on prices. Pure benzene will move out of the high-price environment caused by the supply shortage in H1, with prices falling back to around 6,000 RMB/ton. As the supply tightness for sulfur eases later, its price is also expected to fluctuate downward. Overall, cost support for caprolactam prices in H2 is expected to weaken.

Supply and Demand Aspects: Caprolactam enterprises are currently in a loss-making situation, so their willingness to cut production and support prices remains strong. The overall operating rate of caprolactam enterprises is expected to remain low. Furthermore, there is no new caprolactam capacity planned for H2, so the supply pattern is expected to be tight, which will provide some price support. However, from the demand side, it is still difficult to achieve substantial positive improvements in the short term. The follow-through demand from downstream end-use sectors is insufficient. Moreover, under the current raw material price trends, confidence among downstream sectors to stock up on raw materials is lacking. It is expected that the demand side will continue to constrain prices in H2.

Overall Outlook: It is predicted that in H2, affected by the fall in high costs, the price center of the caprolactam market will fluctuate lower compared to H1. However, supported by improved textile demand in autumn and winter, along with sustained production cuts and reduced operating rates on the supply side, the supply pattern is likely to remain relatively tight. The profitability of caprolactam in H2 is expected to improve compared to the low point seen in June.