Asian polybutadiene prices continue to rise

Source: China National Chemical News January 24, 2019

Sinochem Xinwang News Asia's polybutadiene rubber (PBR) prices continued to rise, driven by rising costs of raw material butadiene (BD) and replenishment activities before the Lunar New Year holiday. According to market sources, the spot quotation of Gaoshun PBR has been raised to US$1700~1800 (ton price, same below; CFR, Northeast Asia/Southeast Asia). ICIS data shows that on January 10, the high-cis PBR evaluation price was 1625 US dollars (CFR, Northeast Asia), an increase of 25 US dollars from last week.

A local synthetic rubber manufacturer stated: \"We must increase the PBR quotation because the cost of raw material butadiene has increased.\"ICIS data shows that since the end of November 2018, the spot price of raw material butadiene has risen by $70, or 6%, butadiene prices reached USD 1195 on January 11, 2019.

\"Because of the Lunar New Year holiday, the operating load rate of Chinese tire manufacturers will be less than 30% in February, and the demand for PBR will also slow down due to the continued decline in sales and output of the Chinese auto market,\" a Chinese PBR manufacturer Said. Another rubber trader said that in view of the uncertainty of the Sino-US trade war and the slowdown in China's auto market demand, most synthetic rubber buyers are more cautious and have adopted a wait-and-see attitude.

According to data from the China Association of Automobile Manufacturers, the Chinese auto market experienced its first decline in more than 20 years in 2018, with total sales falling 2.8% year-on-year to 28.08 million units, and total production falling 4.2% to 27.8 million units. Last year, passenger car sales fell 4.1% to 23.71 million units, while production of such models fell 5.2% to 23.53 million units. The China Association of Automobile Manufacturers predicts that under the current economic environment, the Chinese auto market will show zero or moderate growth this year.