Cost and Supply Drive the Butadiene Rubber Market to a Half-year High

In the first half of 2022, the cis-butadiene rubber market showed a wide fluctuation and an overall upward trend, and it is currently at a high level for the year. According to data monitoring, as of June 20, the price of cis-butadiene rubber was 14,860 CNY/ton, an increase of 3.99% from 14,290 CNY/ton at the beginning of the year, and the low point in the range was 13,350 CNY/ton on January 12.

The price of raw material butadiene has risen by more than half, and the cost support has been greatly strengthened; according to monitoring, as of June 20, the price of butadiene was 11,290 CNY/ton, an increase of 45.66% from 7,751 CNY/ton at the beginning of the year. First, the operating rate of butadiene at the beginning of the year was 70% lower than that of previous years. In addition, two Korean companies failed in February, and the market supply tightened and prices rose. Second, the international crude oil price rose by nearly half in the past six months, and the cost side supported the high price of butadiene. operation; finally, the domestic butadiene export is smooth, and the domestic market price is increased.

Since the beginning of the year, the routine maintenance and unexpected accidents of cis-butadiene rubber enterprises have caused frequent shutdowns of equipment. The operating rate of the cis-butadiene rubber industry has dropped from around 80% at the beginning of the year to around 5-6.5%, and the supply side is relatively tight.

The output of downstream tire companies is slightly lower than last year, but the just-needed procurement still has some support for butadiene rubber.

In the first half of 2022, the natural rubber market fluctuated and fell. As of June 20, the price was 12,700 CNY/ton, down 7.62% from 13,748 CNY/ton at the beginning of the year. From the perspective of substitution, the price of butadiene rubber in the first half of 2022 has basically no advantage over natural rubber.

Market outlook forecast: Analysts believe that the rise in the price of butadiene rubber in the first half of 2022 is mainly affected by supply and cost support. Although butadiene rubber fluctuated higher in the first half of the year, it has not yet broken through the high point in the second half of 2021.

At present, the cost trend of cis-butadiene rubber in the second half of 2022 is more uncertain: the United States actively suppresses international crude oil prices under the pressure of inflation. If inflation returns, international crude oil may fall in the second half of the year; if inflation continues to rise, crude oil prices Or will break the previous high again.

From the demand side, the pressure on the international economy and the difficulty in increasing the production and sales of automobile tires have become the main negative factors for the demand side in the second half of the year; the lifting of the US tariff restrictions on China and the domestic circular economy structure may become a positive factor for the demand side in the second half of the year.

To sum up, it is expected that the butadiene rubber market in the second half of 2022 will show a trend of falling first and then rising, with wide fluctuations, and the price range is between 10,600 and 16,500 CNY/ton.