01 April 2012 18:30 [Source: ICIS news]
HOUSTON (ICIS)--After rising for much of the year, US styrene butadiene rubber (SBR) prices have begun to soften, so far eluding potential demand destruction, industry sources said.
SBR contract and spot prices have climbed in each of the first three months of 2012, but are now softening as buyers are calling for lower prices, and producers are ready to concede rather than face demand destruction.
SBR non-oil grade 1502 contract prices for March are 156–163 cents/lb ($3,439-3,593/tonne), while oil-extended grade 1712 is 135–146 cents/lb.
Spot prices for 1502 are at 173–183 cents/lb and at 152–157 for 1712.
Feedstock butadiene (BD) costs have pushed up SBR prices all year to the point where demand was going to erode.
Unlike last year, when US SBR buyers were competing with offshore demand, the US demand is stronger than what is found in other regions.
At least one producer believes the projected growth in automobile sales this year will help sustain the SBR industry’s performance in 2012. The auto industry forecasts a 5-6% growth for 2012.
About 25% of the tyres manufactured are for new vehicles, with 75% destined as replacement tyres.
North American SBR producers include American Synthetic Rubber Co, Ashland, Firestone Polymers, Goodyear Tire & Rubber, LANXESS, Lion Copolymer and Negromex.
Hosted by the American Fuel & Petrochemical Manufacturers (AFPM), the IPC continues through Tuesday in San Antonio, Texas.
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