Offers by a southeast Asia-based SBR producer were cut by $50/tonne in the current week.
On 4 October, prices of non-oil grade 1502 SBR fell for the second consecutive week to $1,700-1,750/tonne CFR (cost and freight) southeast (SE) Asia, according to ICIS data.
Prices had surged by 26% over a six-week period from 9 August, fueled by spikes in feedstock butadiene (BD) values and on the back of restocking activity.
Spot BD prices had soared by more than 60% over roughly the same period to $1,595/tonne CFR NE Asia on 15 September, before plummeting.
In the past two weeks, SBR suppliers have revised down their offers amid plunging prices of BD and styrene monomer (SM), which is another major feedstock.
Key feedstock BD slumped last week by $165/tonne to $1,410/tonne CFR northeast (NE) Asia on 29 September, while SM declined by $55/tonne over the same period to $1,295/tonne CFR NE Asia.
Demand for SBR has also softened this week, further weighing down on prices, with the major markets of China and South Korea closed for holidays.
China is out on 1-8 October to mark its National Day and Mid-Autumn Festival. South Korea is observing its Chuseok or Thanksgiving holiday on 3-5 October, and market players are expected to be away for the whole week.
From the derivative tyre industry, buyers have retreated to the sidelines. Most have adopted a wait-and-see stance on the SBR market, given the unclear outlook and volatile prices of natural rubber (NR), which is SBR’s rival raw material in typre production.
“We will wait and see due to the uncertain outlook and are in no hurry to commit to any spot [SBR] purchases as we are covered till late November,” a southeast Asia-based tyre maker said.
At midday, SMR20 tyre grade NR prices stood at $1,497.50/tonne FOB (free on board) Malaysia, up from $1,400/tonne FOB Malaysia on 29 September.
In September, NR prices had fluctuated at a wide range of $1,400-1,700/tonne.
Focus article by Helen Yan
Pictured above: Inside a tyre factory in China. Styrene butadiene rubber (SBR) is used as raw material in the production of tyres for the automotive industry. (Source: Top Photo Corporation/REX/Shutterstock)