US spot SBR surges on higher costs, tight supply

Author: Tracy Dang


HOUSTON (ICIS)--Spot prices for US styrene butadiene rubber (SBR) have spiked because of the significant cost increases for feedstocks butadiene (BD) and styrene, as well as ongoing tightness in SBR supply.

ICIS on Thursday assessed spot prices for non-oil grade 1502 SBR at 145-160 cents/lb ($3,197-3,527/tonne) FOB (free on board), up from 110-130 cents/lb FOB in the previous weeks.

March contracts for main feedstock BD had settled at various increases of 11-20 cents/lb, while January contracts for styrene had settled at average increases of 6 cents/lb.

While surging upstream costs helped push up the spot SBR market, prices for prompt SBR rose even further because of ongoing tight supply.

Domestic production of SBR has been reduced because of supply constraints in the upstream BD and styrene markets.

Additionally, some suppliers are seeing an increase in enquiries from customers amid talk that a plant is closing. Sources said the producer is currently operating but evaluating various options for the business.

Spot prices have been heard as high as 200 cents/lb.

Some producers are importing feedstock BD from other regions – including Asia amid a recent arbitrage – at the very high price levels heard prior to the price crash for overseas BD. The expensive costs for those BD imports is keeping SBR offers high.

Sources also said that some suppliers are seeking higher prices because of the implementation of preliminary antidumping duties on SBR imports from Brazil, South Korea, Mexico and Poland.

Demand remains strong, but buyers are resistant to prices above 170 cents/lb on sentiment that the market is softening.

US spot SBR surges on higher costs, tight supply

Major North American producers of emulsion SBR include East West Copolymer, Goodyear Tire & Rubber, Lion Elastomers and Dynasol Elastomers.

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