Poland's Synthos enjoying extended SBR bull run - ING

27 July 2011 15:57  [Source: ICIS news]

LONDON (ICIS)--Poland's Synthos has enjoyed a continuation of a synthetic rubber bull run across the second quarter of 2011, ING Bank said on Wednesday.

“Based on our calculations, European SBR [synthetic butadiene rubber] prices continued their rally and grew by 32% quarter on quarter [in the second quarter of 2011],” said Adam Milewicz, a Warsaw-based ING analyst.

“The main drivers of this rally are strong replacement tyre demand, tight supply and rising input costs,” Milewicz added.

Taking into account the higher-than-expected increase in SBR prices, ING raised its forecast for the average SBR price in 2011 by 15% to €2,733/tonne ($3,961/tonne).

According to figures from major tyre producer Michelin, the European, North American, Chinese and Brazilian passenger car replacement tyres markets have grown by 11%, 2%, 22% and 7% in the year to date, respectively, said ING.

The replacement tyre market is the largest consumer of SBR, accounting for 75% of global tyre sales, the bank added.

ING also had a bullish outlook for SBR during the third quarter.

“European July SBR contract prices have grown by 3% month on month, which accompanied by declining styrene prices (one of the inputs), suggests a very strong MTD [month to date] rubber performance. The July SBR commodity margin reached €1,121/tonne, 5% higher than the [second quarter of 2011] average,” Milewicz said.

Synthos would start production of high-performance poly-butadiene rubber (PBR) in the third quarter, added Milewicz.

“We assume Synthos sales of 20,000 tonnes of PBR this year,” he said.

($1 = €0.69)

By: Franco Capaldo
+44 (0)20 8652 3214

AddThis Social Bookmark Button

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly

Get access to breaking chemical news as it happens.
ICIS Global Petrochemical Index (IPEX)
ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index