Europe Oct butadiene MCP increase as expected by SBR market

01 October 2013 18:02  [Source: ICIS news]

LONDON (ICIS)--The European October butadiene (BD) monthly contract price (MCP) increase of €50/tonne ($68/tonne) was in line with styrene butadiene rubber (SBR) market players’ expectations, sources said on Tuesday.

October’s BD MCP settled at €825/tonne FD (free delivered) NWE (northwest Europe), an increase primarily driven by spot price gains in the Asian BD market.

Usually, SBR producers look to pass on 75% of the BD adjustment. However, one European SBR producer said it would increase its October prices by €50/tonne because of improved demand in Europe and Asia. The producer added that the market could absorb an increase of this magnitude because of a steady and progressive recovery and an open arbitrage window with Asia.

One non-tyre buyer said that it was understandable that producers were looking to pass on raw material costs, while a tyre manufacturer said that SBR demand should pick up, but only a little.

October SBR contract discussions are under way.

($1 = €0.74)

By: Samuel Smith
+44 208 652 3214

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