Price trend

According to the SunSirs’ Commodity Market Analysis System, the domestic 1,3-butadiene market experienced a volatile decline last week. From July 28 to August 4, the domestic 1,3-butadiene market price fell from 9,466.67 RMB/ton to 9,050 RMB/ton, a 4.4% decrease over the period. The domestic 1,3-butadiene market experienced a volatile decline during this period. Port inventories in East China have remained low recently, but domestic refineries have been actively shipping, resulting in an overall ample supply. With prices declining, downstream companies were restocking at low prices, resulting in decent market trading and overall demand remaining relatively strong. Lacking substantial positive support, prices declined throughout the week.

Analysis review

Cost side: As of August 1st, international crude oil futures closed lower, with the September contract for WTI crude oil futures settling at $67.33 per barrel. The October contract for Brent crude oil futures settled at $69.67 per barrel. Market concerns about OPEC's potential increase in oil production, coupled with U.S. employment data, dampened demand prospects.

On the supply side: Sinopec's 1,3-butadiene sales companies were listing prices at 9,200 RMB/ton, with a 200 RMB/ton reduction last week.

Fushun Petrochemical's 160,000 tons/year 1,3-butadiene plant was operating normally, with no supply for export, and prices are suspended.

Shenghong Refining and Chemical's 200,000 tons/year 1,3-butadiene plant was operating normally, with prices at 8,950 RMB/ton.

Satellite Chemical's 90,000 tons/year 1,3-butadiene plant was operating normally, with prices reduced by 100 RMB/ton to 8,900 RMB/ton.

On the demand side: According to the SunSirs’ commodity market analysis system, as of August 4th, the butyl rubber market in East China was experiencing a weak consolidation. Both natural rubber and butyl rubber futures fell, with a small number of inquiries from downstream tire manufacturers for urgent needs. Trading volume was light, and spot market prices were declining. As of August 4th, mainstream butyl rubber prices in Daqing, Yangzi, and Qilu were priced between 11,850 and 12,300 RMB/ton; some private brands were priced around 11,600 to 11,900 RMB/ton.

Market outlook

Crude oil prices have recently been weak and volatile, providing limited guidance and impact on the 1,3-butadiene market. Last week's market trends continued to be driven by supply and demand. The recent restart of some downstream facilities is expected to increase supply. Demand was temporarily generally firm, with limited support. Overall, supply and demand remain weak, and the 1,3-butadiene market is expected to remain weaker in the short term..

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