Multiple Positive Factors Support a Rise in the Butadiene Market

January 16 news

According to the commodity market analysis system data, from January 1, 2026, to January 15, 2026, the butadiene market in China showed a significant upward trend, with prices rising from 8,333.33 CNY/ton to 9,483.33 CNY/ton, a cumulative price increase of 13.8%. During this period, the overall market was volatile but strengthened, with a scarcity of low-priced supplies, firm offers from suppliers, and steady downstream demand providing support. Multiple factors collectively drove the price increase. The following is a detailed analysis from the perspectives of cost, supply, and demand.

Cost Perspective: According to the commodity market analysis system, international crude oil prices have fluctuated and risen during this period, providing solid cost support for the butadiene industry chain. Geopolitical tensions escalating, concerns about the stability of global energy supplies, coupled with marginally improving demand expectations, have driven up crude oil prices. Although naphtha prices experienced some temporary fluctuations during this period, they generally remained relatively high, laying a solid foundation for the upward trend in butadiene prices.

Supply side: Sinopec's various sales companies are implementing a listed price of 9,550 CNY/ton for butadiene.

Dongming Petrochemical's 50,000 tons/year butadiene plant is operating normally, with 2,800 tons of product being sold through bidding, and the floor price is 9,300 CNY/ton.

Yantai Wanhua's 200,000 tons/year butadiene plant is operating normally, with a listed price of 9,600 CNY/ton.

The 90,000-ton-per-year butadiene unit at Satellite Chemical Lianyungang Petrochemical is operating normally. The price has been raised by 200 CNY per ton, bringing the current price to 9,600 CNY per ton.

Demand Side: As a key downstream product of butadiene, the cis-1,4-polybutadiene rubber industry has maintained high operating rates throughout this cycle, with steady procurement demand providing solid fundamental support for the butadiene market. On the production front, China’s utilization rate for high-cis polybutadiene rubber capacity has continued to rise, reaching 79.15% in early January—a 1.97-percentage-point increase from the previous month. Weekly output stood at 31,800 tons, up 2.55% from the prior week. The sustained high plant load has kept rigid demand for butadiene robust and steadily driving procurement activities. Although rising butadiene prices have squeezed processing profits for cis-1,4-polybutadiene rubber—this week, the theoretical production profit for cis-1,4-polybutadiene rubber was only 27 CNY per ton, continuing to narrow from earlier levels—the industry remains highly motivated to keep operations running at elevated rates, demonstrating strong resilience in its demand for the feedstock butadiene.

According to the commodity market analysis system, as of January 15th, the mainstream price of butadiene rubber in Sichuan, China was 12,100 CNY/ton, and the mainstream price of butadiene rubber from Dushanzi, China was 12,600 CNY/ton.

Market Outlook: Overall, during this period, China’s butadiene market has experienced a significant price increase driven by the combined effects of cost support, tight supply, and robust demand. On the cost side, stabilizing and rebounding crude oil prices have strengthened bottom-level support. On the supply side, plant maintenance, depleting inventories, and positive spillover effects from overseas markets have created multiple favorable factors. Meanwhile, high operating rates at SBR plants have ensured sustained rigid demand, and the imbalance between supply and demand has fueled market strength. In the short term, several butadiene units are expected to gradually resume operations in late January, potentially easing supply conditions marginally. However, influenced by anticipated increases in exports and declines in imports, net import volumes are likely to continue shrinking, keeping port inventories at low levels and sustaining suppliers’ willingness to maintain higher prices. On the demand side, SBR plant loadings will probably remain high, and although the tire industry’s operating rates may experience seasonal fluctuations, underlying rigid demand remains unchanged, providing continued support for the butadiene market. We expect China’s butadiene market to remain in a high-range volatile pattern in the near term. Key areas to watch include the pace of unit restarts, trends in crude oil prices, and the transmission of downstream profit margins.