06 January 2011 02:46 [Source: ICIS news]
By Helen Yan
New downstream synthetic rubber plants in
Spot offers for January have already jumped to $2,150/tonne CFR (cost and freight) northeast (NE)
December BD spot prices were assessed at $2,040-2,070/tonne CFR NE Asia by the close of business on 24 December according to data from ICIS.
“The minimum spot offer for January shipments is $2,150/tonne CFR NE Asia and we expect BD spot prices to climb to $2,300-2,400/tonne CFR in March as deep-sea BD supply from Europe has dried up and demand in
Asia’s largest synthetic rubber maker, Korea Kumho Petrochmical Co (KKPC) is scheduled to start up a new 120,000 tonne/year butadiene rubber (BR) plant in
Two new styrene butadiene rubber (SBR) plants in
The synthetic rubber producers are major consumers of BD.
However, BD supply is expected to tighten from February to May, with several crackers including LG Chem, Samsung Total and Yeochun NCC Co (YNCC) shutting down for maintenance during this period.
Asian downstream synthetic rubber makers usually turn to Europe to procure BD spot cargoes if supply in
However, BD spot cargoes from Europe have been diverted to the
“We expect BD spot prices in the
“The arbitrage window from Europe to Asia has closed, which means upward pressure on BD prices in
Apart from rising demand and tighter-than-expected supply, another factor that is providing support to the anticipated upward BD price spiral in the first quarter is the soaring downstream synthetic rubber prices, suppliers said.
“The downstream synthetic rubber makers have big margins and can afford to pay higher BD prices, as the downstream BR and SBR prices have gone up significantly since early December,” a supplier said.
The derivative butadiene rubber (BR) spot prices had surged to $3,700-3,800/tonne CFR NE Asia, up $250/tonne since early December, while the other downstream non-oil grade 1502 SBR prices had increased to $3,000-3,100/tonne CFR NE Asia, up $200/tonne in the past month, according to data from ICIS.
($1 = €0.76)
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