28 October 2011 06:10 [Source: ICIS news]
By Helen Yan
SINGAPORE (ICIS)--Butadiene spot prices in Asia look set to weaken further, possibly falling below $2,000/tonne in November, with pressures mounting for sellers to offload inventory in a bearish market, industry sources said on Friday.
BD offers were heard this week at $1,900-2,000/tonne (€1,330-1,400/tonne) CFR (cost and freight) northeast (NE) ?xml:namespace>
Spot prices have been plunging in recent weeks, as supply outstrips demand.
In the week ended 21 October, BD prices were assessed at a range of $2,200-2,250/tonne, down by about 19% from end-September levels, according to ICIS.
Demand for BD has waned and is expected to remain weak in November as downstream styrene butadiene rubber (SBR) and acrylonitrile-butadiene-styrene (ABS) makers continue to run their plants in
Meanwhile, BD supply remains ample, with cargoes from the Middle East,
“Price discussions on November shipments of BD are now at $1,800-1,900/tonne CFR NE Asia as buyers have no appetite to build up stocks in a bearish market,” a Chinese trader said.
Uncertainty over the global market outlook, bearish market sentiment and weak downstream SBR and ABS markets have curtailed spot appetite for BD and pressured BD prices down, industry sources said.
BD is the feedstock for the manufacture of SBR, which is used in vehicle tyres, and of ABS, which is a type of resin with various applications.
Non-oil grade 1502 SBR prices have also plunged by $800/tonne since late September to $3,100-3,200/tonne CIF (cost, freight and insurance) China in the week ended 26 October, ICIS data showed.
Meanwhile, ABS spot prices have also declined by $200/tonne to around $1,850/tonne CFR NE Asia over the same period, according to ICIS.
Major downstream ABS makers in
Asia’s largest synthetic rubber producer,
KKPC runs a 481,000 tonne/year styrene butadiene rubber (SBR) plant, a 342,000 tonne/year butadiene rubber (BR) unit, a 50,000 tonne/year nitrile rubber (NBR) facility and a 70,000 tonne/year styrene-butadiene-styrene (SBS) plant at Ulsan and Yeosu in South Korea.
($1 = €0.70 / $1 = CNY6.36)
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