The price spread between styrene-butadiene-rubber and butadiene fell $180/mt week on week to a six-month low of $650/mt on June 4, in line with firmer butadiene feedstock value, while SBR price weakened, Platts data showed.
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Register NowThe CFR Northeast Asia SBR price dropped $130/mt week on week to be assessed at $1,750/mt on June 4, the lowest level since February this year, while CFR China butadiene price rose $50/mt to a six-month high of $1,100/mt during the same period.
Asia's SBR market weakened in the week of June 7, as rising COVID-19 cases impacted factory operations, which led to reduced demand for SBR in the region.
China's June automobile sales are weakening due to a shortage of automobile-used microchips as well as bearish demand, according to the China Association of Automobile Manufacturers.
According to China Customs, China's SBR imports in April stood at 23,599 mt, down 27.4% from a month earlier.
Asia's butadiene market moved up after an arbitrage window opened from Asia to the Americas. Trading sources said around 15,000 mt of butadiene has been fixed for June to H1 July loading from South Korea and China to the US/Mexico.
Market sources said the [SBR-butadiene] spread was unlikely to narrow sharply in the near-term, in line with new butadiene plant expansions in Asia.
In June, China's Zhejiang Petrochemical plans to start up its new 200,000 mt/year butadiene unit, while South Korea's LG Chem will start operating its new 130,000 mt/year butadiene plant in Yeosu, S&P Global Platts reported earlier.
There is additional Butadiene available in the market as rising COVID-19 cases in India delayed a few plant turnarounds, market sources said. India's Haldia delayed its steam cracker turnaround until after July, from the original schedule of May, Platts reported earlier. The cracker is able to produce 97,000 mt/year of butadiene.