US June BD seen falling 5 cents/lb on weaker tyre demand

30 May 2013 21:40  [Source: ICIS news]

HOUSTON (ICIS)--The June US butadiene (BD) contract among the three producers that account for about 85% of the market is seen settling at 74 cents/lb ($1,631/tonne, €1,256/tonne), down 5 cents/lb, sources said on Thursday.

One of the three producers that make up the majority of the US market has nominated a price of 74 cents/lb, sources said. Another producer has put forth a nomination of 75 cents/lb, but is expected to come down 1 cent/lb to meet the 74 cent/lb bid.

The third producer has not nominated a June contract price, sources said.

Market participants said a fourth producer, which makes up about 15% of the US BD market, has nominated a June contract price of 79 cents/lb, down from 85 cents/lb in May.

US BD from the three biggest producers traded at 76 cents/lb from December 2012 through February 2013. In March, the monthly contract price rose to 84 cents/lb and then rolled over for April.

But faced with persistently weak worldwide demand for replacement tyres and less expensive styrene-butadiene-rubber (SBR) that was being imported from Asia to the US, the three big US BD producers were forced to lower their monthly contract price to 79 cents/lb in May.

Under continued pressure from both BD consumers and SBR makers over the past few weeks, it was expected that the June BD contract price would fall by another 5 cents/lb.

($1 = €0.77)  

By: Mark Yost
+1 713 525 2653

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