As of April 2026, the 1.3-butadiene market—which surged by over 118% in the first quarter—has entered a phase of correction. According to data from SunSirs, the domestic benchmark price for 1.3-butadiene on April 13 was RMB16,400 per ton, down 9.23% from RMB18,066.67 per ton at the beginning of April, marking a monthly decline of nearly RMB1,000. This round of price fluctuations was not driven by a single factor, but rather resulted from the combined impact of multiple variables, including upstream costs, global supply, downstream demand, and market sentiment. It fully illustrates the price transmission logic of petrochemical intermediates: “cost-driven, supply-constrained, and demand-sensitive.”

I. Cost Side: Geopolitical Premium Fades, Crude Oil Chain Support Weakens

As a core byproduct of ethylene production via naphtha cracking (yield: 15%-25%), 1.3-butadiene’s price exhibits over 90% correlation with crude oil and naphtha. The underlying driver of the first-quarter price surge was the disruption to the crude oil supply chain caused by geopolitical conflicts in the Middle East: oil tankers rerouting their routes drove up shipping costs, the benchmark for international crude oil prices rose, and this was transmitted to1.3- butadiene via the “crude oil → naphtha → ethylene cracking → C4 separation” pathway.

Entering April, the situation in the Middle East eased and geopolitical risk premiums rapidly receded. Crude oil prices retreated from their highs, directly weakening cost support for 1.3-butadiene. At the same time, Asian ethylene plants resumed operations in phases, alleviating naphtha supply tightness and lowering cracking feedstock costs, further opening up downside potential for 1.3-butadiene prices.

II. Supply Side: Global Contraction Pauses, Domestic Inventories Marginally Ease

In the first quarter, the 1.3-butadiene supply landscape featured a pattern of “global contraction and domestic tightness”: Cracking units in many overseas countries reduced operating rates or shut down due to feedstock shortages, while major Asian producers issued force majeure declarations in succession. Global ethylene production is expected to decrease by approximately 22 million tons, leading to a passive contraction in 1.3-butadiene supply; Domestically, multiple ethylene units underwent concentrated maintenance from January to March, causing port inventories in East China to drop to a low of 27,600 metric tons—a 38% decline from the beginning of the year. This supply-demand mismatch drove prices to surge above RMB18,000 per metric ton.

Since April, supply-side pressures have marginally eased: overseas plants undergoing maintenance have gradually resumed production, Asian cracking rates have slightly increased, and imported supplies have grown; domestically, plants that underwent earlier maintenance have gradually restarted, increasing market circulation. Coupled with the stimulus from high prices in the first quarter, some supplies have shifted toward export arbitrage. As a result, the tight domestic spot supply situation in April has eased, support from low inventory levels has weakened, and factory offers have consequently been adjusted downward.

III. Demand Side: High Prices Suppress Essential Demand; Downstream Losses Force Price Cuts

Over 70% of 1.3-butadiene demand is concentrated in synthetic rubber (styrene-butadiene rubber, polybutadiene rubber), with the remainder used in sectors such as ABS resin and nylon 66. Following the sharp price surge in the first quarter, cost pressures on downstream sectors soared, price pass-through was hindered, and the demand side became the primary driver of the price correction.

On the cost side, 1.3-diene accounts for over 70% of the raw material cost of 1.3-butadiene-rubber. High prices have caused rubber manufacturers to suffer significant losses, with operating rates plummeting from over 80% to 40%-50%. Some facilities have proactively reduced production capacity, and raw material procurement has shifted from “stockpiling and restocking” to “spot purchases based on demand.” On the demand side, the “Golden March and Silver April” peak season for end-user industries such as tires and automobiles fell short of expectations. Weak domestic demand, coupled with high prices, has dampened downstream willingness to purchase. Meanwhile, excessively high synthetic rubber prices have prompted some sectors to switch to natural rubber substitutes, further diverting demand for 1.3-butadiene.

As of April 13, downstream prices for styrene-butadiene rubber (SBR) and polybutadiene rubber (BR) have corrected in tandem with raw material prices. The market has shifted from a pattern of “upstream price hikes followed by downstream price increases” to one of “upstream price cuts and downstream caution,” breaking the positive cycle within the industry chain and sending prices into a downward trend.

IV. Market Outlook: Short-term Volatility and Bottom-Finding, with Mid-term Support Remaining

In the short term, 1.3-butadiene prices remain under downward pressure: geopolitical premiums are fading, cost support is insufficient, and ample supply combined with weak demand means the market is focused on destocking, with prices likely to continue testing lower levels to find support. However, in the medium term, the industry’s fundamentals have not undergone a fundamental reversal: 1.3-butadiene supply is highly dependent on ethylene cracking, with no inherent production flexibility; the global shift toward lighter feedstocks in cracking units (replacing naphtha with ethane) will suppress supply growth in the long term; should geopolitical conflicts resurface or overseas facilities face further force majeure events, expectations of tightening supply will reignite.

Meanwhile, although downstream demand remains weak in the short term, the tire and automotive industries are still in a recovery cycle, and demand for ABS resin remains robust. Once prices fall back to a reasonable range, downstream restocking demand will gradually materialize. It is expected that from late April through May, the 1.3-butadiene market will primarily trade within a range, with prices fluctuating between RMB16,000 and 17,500 per ton. Key factors to monitor for future trends include the situation in the Middle East, ethylene plant operating rates, and the pace of downstream restocking.

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