US Goodyear declares force majeure on SBR

27 May 2011 22:01  [Source: ICIS news]

HOUSTON (ICIS)--US-based tyre producer Goodyear declared force majeure on styrene butadiene rubber (SBR) and other butadiene (BD) derivatives because its supplier is short of the monomer, the company said on Friday.

"While we are working diligently to identify and obtain alternative sources of butadiene monomer supply, at this time we do not know how long the situation will last," the company said in a statement.

BD is a key feedstock for styrene butadiene rubber (SBR), used to make tyres, belts, hoses and numerous other products.

Domestic BD supply is tight because of an ongoing turnaround by one producer that is expected to last until the middle of June.

Other factors are the sales control from another producer following production issues earlier in the year and limited crude C4 exports from Libya in the first quarter. Crude C4 is the feedstock for BD.

The shortage has driven BD spot prices to the $2/lb ($4,409/tonne, €3,130/tonne) mark, while contract nominations for the June BD settlement were $1.50-1.65/lb, according to ICIS.

The run-up in BD values prompted SBR producers to raise May contract prices for 1502 non-oil grade material to $1.55-1.61/lb and is threatening to erode demand, suppliers said.

Major US BD producers include ExxonMobil, LyondellBasell, Shell and TPC Group.

($1 = €0.71)

By: Gene Lockard
1 713 525 2653

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