In the latter half of April, as ceasefire negotiations in the Middle East advanced, international oil prices retreated, and butadiene prices continued their downward trend, causing the cost support for butadiene rubber to collapse. As of April 29, the mainstream quoted price for BR9000 in the East China region had fallen to 16,180 RMB/ton—a decline of 3.36% from the 16,790 RMB/ton recorded on April 15. The futures market weakened in tandem; during this period, the most active contract fell below the 15,500 RMB/ton mark.
During the second half of April, expectations regarding a recovery in butadiene supply strengthened, and port inventories began to accumulate. Consequently, prices retreated for several consecutive sessions, recording a weekly decline of over 8%. The production costs for BR fell accordingly, and the degree of cost-based support for its pricing continued to diminish. According to the SunSirs Commodity Market Analysis System, the price of butadiene stood at 12,566 RMB/ton as of April 29—a drop of 22.11% from the 16,133 RMB/ton recorded on April 15.
Due to severe losses incurred in the preceding period, domestic BR production facilities continued to operate at low utilization rates; in April, the industry's overall operating rate hovered around 45%, which is significantly lower than the figure for the same period last year. Manufacturers continued to prioritize inventory reduction, which helped limit the extent of the decline in BR prices.
Downstream tire production remained largely stable, although manufacturers of all-steel tires successively initiated maintenance shutdowns and production cuts, leaving limited room for further increases in overall capacity utilization. Consequently, the downstream sector continued to provide a baseline level of rigid demand support for BR. Furthermore, influenced by negotiations between the U.S. and Iran, crude oil prices retreated from the highs reached at the onset of the regional conflict; the geopolitical risk premium partially dissipated, and market risk aversion sentiment cooled. As a result, overall market sentiment shifted toward caution.
Looking ahead, raw material butadiene prices have retreated from their recent highs, resulting in insufficient cost support. On the supply side, the current low operating rates are unlikely to change significantly in the short term. On the demand side, rigid demand continues to provide a baseline level of support; consequently, there is limited room for significant price fluctuation in the BR market in the immediate future. Additionally, changes in the Middle East situation will continue to impact the BR industry chain indirectly via crude oil prices. Should the conflict between the U.S. and Iran escalate after the holiday period—triggering another sharp rise in crude oil prices—the resulting cost support would likely halt the decline in BR prices in May, prompting a renewed upward trend.
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