08 May 2013 23:59 [Source: ICIS news]
LONDON (ICIS)--European spot and contract styrene butadiene rubber (SBR) prices have dropped because the market is oversupplied, demand is weak and feedstock costs have dropped in May, sources said on Wednesday.
The price of 1500 grade SBR is at €1,800-1,880/tonne ($2,368-2,474/tonne) free delivered (FD) northwest Europe (NWE), down by €60-70/tonne. The price of 1723 grade is at €1,690-1,750/tonne FD NWE and the 1783 grade is at €1,640-1,700/tonne FD NWE, a drop of €60-100/tonne.
In recent weeks, an influx of cheap Russian and Asian imports has also depressed prices – especially in eastern Europe, where traders complained of tough competition.
Spot 1500 grade SBR is being offered at €1,650-1,710/tonne FD NWE.
The price of feedstock butadiene (BD) dropped by €75/tonne in May – generally, about 75% of the BD contract price movement is passed on to the SBR market – which contributed to the above drop in SBR contract prices.
One western European producer said it was not worried about the Russian imports, describing them as only a drop in the ocean and mostly affecting eastern Europe, where it has little business. However, an eastern European seller has been more concerned because the market is weak and it has become difficult to distinguish between European contract and Russian import prices.
This is because a number of buyers have been bidding to buy western European material at the lower spot prices, but these are of Russian origin, with which western Europeans cannot compete.
($1 = €0.76)
Follow Janos Gal on Twitter @janosgalICIS
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