SunSirs: China BR Market Fell in July due to Weakness

In July, polybutadiene rubber market was weak and fell. According to the data monitoring of SunSirs, as of July 31, the price of CIS polybutadiene rubber was 13,860 RMB/ ton, down 5.00% from 14,590 RMB/ ton at the beginning of the month. The overall price of raw butadiene fell, and the cost side support weakened; The operating rate of downstream tires fell, and the demand side was weak; Drive the CIS polybutadiene rubber market downward. However, the international crude oil price rebounded at a low level in the second half of the month, driving the market bullish atmosphere. At the end of July, the butadiene rubber market rebounded slightly, but the strength was very weak.

Butadiene prices fell in July, and the cost of butadiene rubber weakened in the face of support. According to the monitoring of SunSirs, as of July 31, the price of butadiene was 9,618 RMB/ ton, down 7.53% from 10,402 RMB/ ton at the beginning of the month. In July, there were many early maintenance devices restarted in domestic butadiene plants, which brought some pressure on the supply side.

In July, the natural rubber market fell first and then rose. The overall weakness has a negative impact on cis-1,4-polybutadiene rubber. As of July 31, the price was 12,300 RMB/ ton, down 5.05% from 12,954 RMB/ ton at the beginning of the month, and the low point in the month was 11,910 RMB/ ton. At present, the spot market of natural rubber in China has been at an annual trough. For downstream product enterprises, the purchase cost of rubber has been reduced recently, and the order receiving and operating rates of some enterprises have recovered. It is not excluded that the seasonal off-season demand and high finished product inventory still have the greatest impact on the operation of product enterprises.

In July, domestic tire enterprises started to operate slightly lower, with the start of all steel tires at 65%, and the start of half steel tires at 55%. In addition, the rubber products industry was slow to ship due to the off-season, and the overall start-up did not significantly improve, which supported the weak demand for cis-1,4-polybutadiene rubber.

Market forecast

SunSirs analysts believe that, on the one hand, the production of new cis-1,4-polybutadiene units in the second half of the year will bring further pressure to the supply side. In addition, the demand side is slightly weak, and it is expected that China BR will not rebound significantly in the later period.

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