SINGAPORE (ICIS)--Spot butadiene prices in Asia look set to fall further in the near term because of weak buying interest and ample supply amid declining domestic BD prices in China.
Buyers have retreated and adopted a cautious stance on the market following price cuts issued by Chinese BD producers this week.
“Buyers are holding back and buying ideas have dropped below $950/tonne CFR NE Asia this week,” a trader said.
On 21 July, spot prices were assessed at $950-1,000/tonne CFR (cost and freight) northeast (NE) Asia, ICIS data showed.
At the start of the week, Fushun Petrochemical cut its domestic BD offers by CNY500/tonne to CNY7,500/tonne ex-works.
Buying sentiment in Asia has also weakened due to an expected influx of deep-sea cargoes in August and September.
More than 20,000 tonnes of BD from Europe and the US Gulf are scheduled to arrive in Asia in the next two months.
“We are covered for August and not pressured to procure additional spot volumes from regional producers,” a downstream synthetic rubber producer said.
($1 = CNY6.74)
Pictured above: A worker at a car tyre factory in China. Butadiene (BD) is a raw material for the production of synthetic rubbers, which go into tyres for the automotive industry. (Source: Top Photo Corporation/REX/Shutterstock)