SINGAPORE (ICIS)--Spot styrene butadiene rubber (SBR) prices in India look set to spike as South Korean suppliers raised their export offers to the country amid heftier anti-dumping duties (ADDs) imposed on their competitors from Europe and Thailand.
SBR supply from Europe and Thailand to India is expected to wane, given ADDs of more than $200/tonne that will be slapped on Indian imports of non-oil grade 1502 SBR from these origins.
South Korean SBR makers, which are subject to much lower ADD rates, have capitalized on the situation by raising their offers for August shipments, industry sources said.
Spot offers for non-oil grade 1502 SBR for August shipments of Korea-origin product increased to $1,600/tonne CFR (cost and freight) India.
On 19 July, non-oil grade 1502 SBR prices were assessed at $1,500-1,550/tonne CFR India, ICIS data showed.
“It is a sellers’ market as there will be less available supply from Europe and Thailand due to the higher anti-dumping duties they have to pay,” a South Korean SBR producer said.
The highest ADD rate of $266/tonne was recommended for all other EU producers except Synthos, which gets a lower rate of $207.49/tonne, based on the notice dated 12 July by the Directorate General for Anti Dumping and Allied Duties of India.
For Thai producers that sell SBR to India, an ADD rate of $243.60/tonne applies.
SBR imports from South Korean producers LG Chem and Kumho Petrochemical Co will be levied ADDs of $28.68/tonne and $33.95/tonne, respectively. For other Korean producers, a higher $64.00/tonne ADD rate applies.
“Tyre makers in India have to pay higher prices for SBR as imports from Europe and Thailand will face hefty anti-dumping duties,” a supplier said.
Tyre makers in India have sought a discount for August cargoes, citing recent price declines in feedstock butadiene (BD).
BD prices in Asia fell by $50/tonne week on week to $975/tonne CFR northeast (NE) Asia on 21 July, ICIS data showed.
“SBR prices to India will not drop in August despite the feedstock BD price falling as supply is tight and tyre makers have to re-stock their inventories,” a South Korean SBR maker said.
Tyre makers in India are expected to put up a strong resistance to any significant price increase for August shipments, since they can still procure cheaper ADD-exempt SBR from Europe if their end-producs are exported.
“We can still get cheaper non-oil grade SBR from Europe at $1,300/tonne CFR India,” said an Indian tyre exporter.
Focus article by Helen Yan
Pictured above: A car manufacturing plant in China. Styrene butadiene rubber (SBR) is a raw material for the production of tyres for the automotive industry.