The market of BR rose slightly in July. According to the commodity market analysis system of SunSirs, as of July 28, the market price of BR in East China was 10,830 RMB/ton, up 4.03% from 10,410 RMB/ton at the beginning of the month. The price of raw butadiene rose sharply, and the cost support of BR strengthened significantly; In July, the construction of downstream tire factories rose slightly, and the support for BR just needed was slightly stronger than in the early stage; In July, the ex factory price of two barrels of oil BR was raised. As of July 28, the ex factory price of PetroChina Northeast Sales Company Daqing BR was 10,900 RMB/ton, and the domestic mainstream offer range of BR was 10,600 RMB/ton to 11,000 RMB/ton.
Supply side: In the first half of July, Qixiang, Wanda and other BR devices stopped, and the operating rate of BR decreased slightly; In the second half of the month, Qixiang Tengda BR rubber plant was restarted on the 17th; The restart of Yangzi Petrochemical BR plant was delayed; Shandong Wanda Shunding Plant is scheduled to restart on July 17th; The Shunding unit of Zhejiang Petrochemical was shut down for maintenance for about two weeks on July 18th. The supply pressure of BR increased slightly compared with the first half of the month.
Cost: butadiene prices rose sharply in July, and BR cost support strengthened significantly. According to the Commodity Market Analysis System of SunSirs, as of July 28th, the price of butadiene was 7,201 RMB/ton, an increase of 20.56% from 5,973 RMB/ton at the beginning of the month. At the beginning of the month, major production enterprises such as Sinopec raised their factory quotations, which boosted the mentality of merchants in offering, but downstream companies resisted high prices. The transaction of some offshore cargo in South Korea and Southeast Asia is still acceptable, but the price is still lower than the domestic spot price, so it is temporarily difficult to bring a significant boost to the domestic market. In mid month, parking news was concentrated, and the capacity utilization rate of the butadiene industry decreased; The high transaction price of the external market has boosted the sentiment of domestic merchants; At the same time, the downstream synthetic rubber market has strengthened, the price difference between upstream and downstream has widened, and the fundamentals of the butadiene market have been supported. As the end of the month approaches, prices for external and domestic production enterprises are firm, while downstream operations and profits are still good. There is some support for demand in the face of the market. With the arrival of imported cargo at the port, port inventory has increased, and some early maintenance equipment has restarted, leading to an increase in domestic production. Supply side expectations have led to cautious downstream inquiries, and the increase in butadiene market prices has weakened.
In July, the natural rubber market fluctuated slightly higher, but with the price of BR rising, the substitute support of natural rubber for BR weakened. According to the Commodity Market Analysis System of SunSirs, as of July 28th, the price was at 11,960 RMB/ton, an increase of 1.27% from 11,810 RMB/ton at the beginning of the month, and the highest point in the cycle was 12,150 RMB/ton.
Demand side: The tire operating rate slightly increased in July, with a slightly stronger demand for rubber support compared to the previous period. It is understood that as of late July 2023, the operating load of all steel tires for rubber tire enterprises in Shandong region is 6.2%; The operating load of semi steel tires for domestic rubber tire enterprises is 7.2%.
SunSirs analysts believe that the raw material price has risen significantly, the supply side pressure has slightly increased, the downstream starting support has slightly strengthened, the performance of BR industry chain in July has slightly improved compared with the previous period, and driven by the rising atmosphere of BR futures on Friday night, it is expected that the spot market of BR will continue to rise tentatively in the short term. In the later stage, it is still necessary to pay attention to the changes in downstream actual demand support.
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