In 2022, SBR fluctuated downward, showing a phased wave dynamic potential. As of December 31, 2022, the price of SBR 1502 in East China was 10,816 RMB/ton, down 11.58% from 12,233 RMB/ton at the beginning of the year. It is mainly divided into two stages:

From January to June, the SBR market fluctuated and consolidated. On the one hand, the outbreak of the Russian-Uzbekistan conflict pushed up the international crude oil price. The price of raw butadiene rose 171.75% and the price of styrene rose 33.33% in half a year. The cost of SBR was strongly supported in the first half of the year; On the other hand, there is no obvious improvement in demand, which can suppress the action of styrene butadiene. Under the game of cost and demand, SBR fluctuated and consolidated in the first half of the year.

In the second half of the year, the SBR market fell by 16.90%. First of all, the price of raw materials fell from a high point, and the price of raw butadiene fell 42.26% from the high point in the year to December 28; The price of styrene fell by 28.91% from the high point of the year to December 31, and the cost of styrene butadiene rubber fell sharply. Secondly, in the second half of the year, the domestic SBR plant was occasionally shut down for maintenance for 10-20 days, and the operating rate of SBR industry fluctuated in a narrow range. Finally, it is difficult for downstream tire enterprises to significantly improve their construction and demand is weak. SBR fell in the second half of the year due to three factors.

Supply side: In 2022, the supply side of emulsion styrene butadiene rubber is relatively stable, with no new capacity. The theoretical production profit of SBR in the first quarter was good, the capacity utilization rate of each unit remained relatively high, and the supply increment was obvious; In the middle of the year, due to the continuous negative profit, the production enterprises generally reduced the negative production, but the downstream demand was flat, and the market consumed inventory mainly; In the third and fourth quarters, except for the shutdown and maintenance of some enterprises in some time periods, the rest of the construction was basically stable. Throughout 2022, the start-up of styrene butadiene unit is mainly stable.

Demand side: downstream tire enterprises have no significant improvement in the construction in 2022, and the output of tire cover is basically in a year-on-year decline. The weak demand side has dragged down the SBR market. According to the data released by the National Bureau of Statistics, 74.812 million tires were produced domestically in November 2022, down 7.0% year on year; From January to November, 787.92 million tire covers were produced, down 4.0% year on year.

Impact of costs and related products: In 2022, the price trend of domestic SBR is mainly due to the rise and fall of supply and demand and cost. In the first half of the year, affected by geopolitical factors, crude oil drove up the price of butadiene and styrene rapidly, and the cost of SBR was strongly supported. In the second half of the year, the price of raw materials fell sharply, and the cost of SBR was dragged down. The price of natural rubber dropped from 13,748 RMB/ton at the beginning of the year to 11,480 RMB/ton at the end of October. Due to the negative impact of the correlation between the two on SBR, the price rebounded after November, forming a certain bottom support for SBR.

Analysts from the Business Agency believe that the supply of SBR will not change much in 2023. With the further optimization of the epidemic prevention policy, it is expected that the domestic consumption power will gradually increase at the end of the first quarter, and the downstream construction may increase to a certain extent. The domestic demand has a certain support for SBR. On the whole, in 2023, if there is a super increase or decrease in cost, SBR will fluctuate between 10,800 and 13,500 RMB/ton in China.

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