SBR price fears will continue to rise

Sinochem’s new online newsletter entered the month of June. The styrene-butadiene rubber market was as hot as in the midsummer. The feast of rising feasts continued to hit historical highs and there were no signs of stopping for the time being. The positive side of demand, as well as the lack of market supply, has become a strong support for SBR, and businesses have raised their prices. SBR market after the favorable factors in the case of absolute advantage, the market operating enthusiasm, the price may continue to stage a high market. Within half a month, the manufacturers raised the ex-factory prices three times. The overall increase was 2,000 yuan (t price, the same below). At present, the rosin styrene butadiene rubber quoted in the 31200 ~ 32200 yuan; oil-filled styrene butadiene rubber 1712 offer is rare, only after the Dragon Boat Festival has an increase of 1,000 yuan.

- Driven by external disks. Following the announcement of force majeure by major US manufacturers, the demand for styrene butadiene rubber in various parts of Asia has increased at different levels. It is reported that US tire manufacturers seek to purchase spot products from Asia. Several Asian styrene-butadiene rubber manufacturers stated that they had received enquiries from the US tire manufacturers for the purchase of the product on the spot. Because more profits can be obtained, some manufacturers have stopped providing SBR products to the Chinese market and turned to the United States. The increase in demand from Japanese tire manufacturers further added momentum to prices. China's current tight supply pushes the price of 1502 SBR grades to US$4,200 to 4,300 (CIF China).

- Raw materials continue to rise. After the Dragon Boat Festival, the butadiene market continued its uptrend. The market price was around 24,500 yuan, mainly due to tighter supply in the Asian market and firmer US demand support. External market prices for butadiene in the Asian market soared, and export enthusiasm for domestic businesses continued. Increases, quotes are high, and supply to the domestic market is reduced; boosted markets have made traders more optimistic about their attitudes and increased operating practices.

- The supply is tight. Another major reason leading to the continued rise in the price of styrene butadiene rubber is the current tight supply of goods in the market. Suppliers are still supplied for export orders signed earlier, and domestic traders are in short supply due to limited billing, and even some individual markets are almost zero stocks, resulting in the market almost closed. It is expected that some manufacturers will stop production and maintenance in June, resulting in a positive boost in supply of goods.

However, the current market for styrene-butadiene rubber is not an excellent one. The sentiment of end-user enterprises is still low, and there is no procurement support from the demand side. The phenomenon that the SBR market is priceless will increase the risk of its correction.

In summary, inventories in the market continue to decrease while styrene butadiene rubber production enterprises are mainly export-oriented. Although favorable factors exist, positive effects dominate the market. In the short-term, SBR is expected to continue to climb to historical highs, but the market The risk will continue to increase, and operations need to be extremely cautious.

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