SBR price increases in April could deter buyers

21 March 2013 18:20  [Source: ICIS news]

PARIS (ICIS)--If European styrene butadiene rubber (SBR) prices increase in April, buyers might reduce orders to a minimum, a major consumer told ICIS on the sidelines of the Paris International Rubber Conference on Thursday.

"In February, we bought more [SBR] because we were worried about increases in March, and again we bought more in March because we were worried about increases in April, but we will stop doing this in April as we have accumulated enough stocks," the buyer said.

The buyer added that it can secure lower-priced cargoes from Russia, so it will buy all additional cargoes above its contracted volumes from there if western European sellers increase their price offers.

Russian SBR is offered at €1,680/tonne ($2,167/tonne) ex-works (EXW) Russia. Freight from Russia to eastern Europe is about €60/tonne, while to western Europe it is about €80/tonne.

Feedstock butadiene (BD) prices dropped from €2,185/tonne free delivered (FD) northwest Europe (NWE) in March 2012 to €1,415/tonne FD NWE in March 2013.

During the same period, 1500 grade SBR prices fell from €2,675-2,750/tonne FD NWE to €1,860-1,950/tonne FD NWE.

According to other sources, there is potential for increases in April if BD costs go up.

The International Rubber Conference 2013 runs from 20-22 March.

($1 = €0.77)

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By: Janos Gal
+44 208 652 3214

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