01 May 2012 05:52 [Source: ICIS news]
By Helen Yan
BD prices declined to $2,750-2,800/tonne CFR (cost and freight) northeast (NE)
“BD prices are in free fall now and I will not be surprised if prices were to drop further to around or below $2,000/tonne,” a trader said.
A number of downstream synthetic rubber and plastics producers in
“We expect BD to drop further in May as spot interest is very weak given the global economic slowdown,” another trader said.
Softer demand for synthetic rubbers – one of the main downstream sectors of BD – prompted major regional producers such as South Korea’s Kumho Petrochemical, LG Chem; Taiwan’s TSRC, and; China’s Shen Hua Chemical, Jilin Petrochemical and Fuxiang Chemical to reduce run rates at their facilities or take the plants off line for maintenance.
BD is the feedstock for synthetic rubbers, such as styrene butadiene rubber (SBR) and butadiene rubber (BR), which are used in the production of tyres for the automotive industry.
China is the second biggest economy in the world and ranks as the largest car market globally. But its auto sales shrank 3.4% year on year in the first quarter of 2012, after registering a much subdued growth of 2.5% for the whole of 2011, official data showed.
According to the European Rubber Journal, the world’s truck tyre replacement sales in March have declined across all markets, citing statistics from global tyre producer Michelin.
In Europe, March original equipment demand for truck tyres fell 2.8% year on year, while tyre truck replacement sales declined by a steeper 26.5%, according to Michelin.
($1 = €0.76)
Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections
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