China’s Shen Hua mulls SBR output cut in Q2 on weak demand

14 March 2013 02:47  [Source: ICIS news]

SINGAPORE (ICIS)--China’s Shen Hua Chemical Industrial may cut production at its 180,000 tonne/year styrene butadiene rubber (SBR) plant in the second quarter because of poor demand, a company source said on Thursday.

“Demand is very weak and market conditions are worse-than-expected, so we will reduce our operating rate in April, May and June to between 70-80% of capacity,” a company source said.

The SBR plant in Nantong is currently running at full capacity, the source said.

The second quarter is usually a high production period for factories. For a manufacturer to reduce operating rate during this time reflects a significant slowdown in demand, industry sources said.

Non-oil grade 1502 SBR prices were assessed at $2,350-2450/tonne (€1,810-1,887/tonne) CIF (cost, insurance and freight) China on 13 March, down by $50-100/tonne from the previous week, according to ICIS.

Surplus stocks and waning demand have forced traders to offload cargoes-in-hand at lower prices to draw in buyers, industry sources said.

Chinese domestic non-oil grade 1502 SBR prices fell to yuan (CNY) 16,000/tonne EXWH (ex-warehouse), down by CNY1,000/tonne from the previous week, according to Chemease, an ICIS service in China.

($1 = €0.77)

By: Helen Yan
+65 6780 4359

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