The ICIS Butadiene report is published for Asia, Europe and the US, though the Crude C4s section is published only for Europe and the US.
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Updated to Q1 2019
Butadiene (BD) supply in Asia in the first quarter of 2019 is expected to ease as BD plants in China are expected to resume production following their turnarounds in the fourth quarter of 2018. Deep-sea supply from Europe and the Middle East is also expected to increase, with cargoes from these regions heading to Asia ahead of the Lunar New Year holidays in early February.
Demand for butadiene (BD) is mixed in the first quarter of 2019. Spot interest is expected to pick up for January shipments on re-stocking ahead of the Lunar New Year holidays in early February. However, it is unclear whether demand will remain firm after the Lunar New Year holidays, given concerns over the ongoing trade war between the US and China, the world’s two largest economies.
Sentiment regarding European butadiene supply is fairly mixed. The US-China trade war uncertainty could keep buying sentiment cautious and slow so there could be ample availability at least during the first half of the quarter if exports to Asia remain limited. However, a fairly heavy raft of planned cracker and BD unit turnarounds will be getting underway in the spring so output will undoubtedly be constrained. The market could swing between a balanced to tight or balanced to long supply situation.
Demand for Europe’s butadiene volumes should be better than that seen in the previous quarter but there is a great deal of uncertainty on how strong the pull might be from key end-market Asia which impacts both BD as well as BD’s derivatives. Domestic consumers will likely fulfill all contractual obligations – higher volumes have been contracted in 2019 according to some suppliers – at least in the run-up to and during the spring maintenance season. There is also likely to be some added demand as some players impacted by the low Rhine water levels last year, catch-up.
US butadiene (BD) supply levels are expected to continue to improve during the first quarter of 2019. New crackers coming on line will increase supplies of feedstock crude C4 (CC4) and, in turn, BD. In addition, crude price weakness could keep cracking of heavier feedstocks economic if sustained.
US butadiene (BD) demand should pick up during the first quarter of 2019 in line with typical seasonal patterns. Lower US prices relative to earlier in 2018 could spur demand from downstream styrene butadiene rubber (SBR) buyers as lower costs would allow them to better compete with SBR import prices.
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The major source of butadiene is as a by-product in the steam cracking of naphtha and gas oil to make ethylene and propylene.
Butadiene is a colourless, non corrosive liquefied gas with a mild aromatic or gasoline-like odour. It is slightly soluble in water, more soluble in methanol and ethanol, and soluble in most common organic solvents such as acetone, ether, benzene, and cyclohexane. It readily polymerises in the presence of sodium or oxygen.
Butadiene is used to produce synthetic rubbers and polymer resins, as well as a few chemical intermediates. The largest uses are styrene butadiene rubber (SBR) and polybutadiene rubber (BR), mostly used in tyres and automobiles.
The major source of butadiene is as a byproduct in the steam cracking of naphtha and gas oil to make ethylene and propylene. The butadiene is extracted from the C4 cracker stream using extractive distillation.
Other uses include acrylonitrile-butadiene-styrene (ABS) resins, styrene-butadiene latex and block copolymers, nitrile rubber, and adiponitrile (ADN).
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December 5, 2018 // The Maxwell New York City
Exploring the drivers for the future of the US butadiene market