FocusChina’s SBR prices likely to decline in late April on falling BD

18 April 2012 05:57  [Source: ICIS news]

By Sunny Pan

SINGAPORE (ICIS)--China’s styrene butadiene rubber (SBR) prices are likely to decline slowly in late April because prices of the feedstock butadiene (BD) are falling, industry sources said on Tuesday.

Latest BD prices were assessed at yuan (CNY) 24,500-25,000/tonne ($3,889-3,968/tonne) DEL (delivered) east China on 13 April, down by CNY1,200/tonne from 30 March.

The east China sales branch of major domestic SBR supplier Sinopec announced that it was cutting its BD offer on 16 April by CNY1,000/tonne to CNY25,000/tonne, a company source said.

As BD prices fall, SBR traders and end-users are adopting a wait-and-see attitude, with some refusing to accept SBR at present prices, an industry source said.

SBR suppliers may be forced to lower their offers to stimulate buying interest, the source added.

A Chinese SBR producer said the weak demand will cause SBR prices to fall but the decline will be limited.

At current feedstock prices, non-oil grade SBR 1502 - the most commonly-used form of SBR used in China - must be priced at no less CNY24,600/tonne for sellers to break even, industry sources said.

Prices for non-oil grade SBR 1502 in east China on 18 April were at CNY23,200-23,900/tonne, down by CNY400-500/tonne from 31 March, according to Chemease, an ICIS service in China.

However SBR prices may be boosted in May by a decrease in supply, as major supplier Jinlin Petrochemical is planning to shut its 150,000tonnes/year SBR unit for maintenance for more than a month from mid-May, according to an industry source.

($1 = CNY6.30)

By: Sunny Pan

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