Price trend

In June 2026, a confluence of bearish factors hit the 1,3-butadiene market, driving a sustained, unidirectional downward trend and causing a significant drop in price levels. Upstream raw material prices continued to decline throughout the month, steadily weakening cost support; this coincided with relatively ample domestic supply and a steady accumulation of inventories. Meanwhile, downstream industries entered their traditional off-season, resulting in insufficient demand and sluggish overall trading activity. Traders largely offered price concessions to move stock, while market participation was dominated by low-level restocking to meet immediate needs, reflecting weak overall market fundamentals. According to the Commodity Market Analysis System of SunSirs, the domestic 1,3-butadiene market price fell from 11,800 RMB/ton to 8,866.67 RMB/ton between June 1 and June 30, representing a decline of 24.86% over the period.

Market analysis

Cost side:

International crude oil prices continued to decline throughout the month, with the price premium previously driven by geopolitical tensions largely evaporating; this pushed down the prices of domestic feedstocks such as naphtha and steam-cracked C4, thereby easing the cost of raw materials for 1,3-butadiene production. Domestic ethylene spot prices also fell, alleviating production pressure on refining and petrochemical enterprises and allowing production margins to recover; consequently, manufacturers showed little inclination to hold firm on prices. Meanwhile, overseas 1,3-butadiene quotes continued to drop, lowering the landed cost of imports and exerting persistent downward pressure on the domestic spot market; an increase in low-priced supply further drove the overall market trend downward. As of June 29, the settlement price for the August contract of US WTI crude oil futures stood at $70.75 per barrel, while the settlement price for the September contract of Brent crude oil futures was $73.91 per barrel.

Supply Side:

Domestic 1,3-butadiene supply was generally ample in June; market availability was relatively high, and inventories trended upward. Although some domestic units underwent periodic maintenance during the month, the overall scale of maintenance was limited. Most major units maintained normal operating loads, with some increasing output based on demand; consequently, the stable and sufficient supply of domestically produced material fully offset the volume lost to maintenance. Meanwhile, steady arrivals of imports further supplemented domestic market supplies. Amidst this overall supply pressure, the pace of downstream purchasing slowed, leading to a continued buildup of inventories at ports and among traders. With abundant spot market liquidity and significant pressure to move stock, sellers frequently offered price concessions to facilitate sales, further driving market prices downward.

As of June 30, the listed price for 1,3-butadiene across Sinopec's sales subsidiaries stood at 9,000 RMB/ton, a reduction of 3,000 RMB/ton from the 12,000 RMB/ton price on May 28.

Dongming Petrochemical's 50,000-tonne/year 1,3-butadiene unit is operating normally; 168 tonnes are being offered for external sale with a reserve price of 8,800 RMB/ton.

Satellite Chemical's 90,000-tonne/year 1,3-butadiene unit is operating normally; 336 tonnes are being offered for external sale with a starting price of 8,700 RMB/ton.

Demand Side:

June saw clear signs of a seasonal slowdown in downstream demand; overall essential demand remained weak, failing to provide effective market support. As the tire industry entered its traditional off-season, terminal orders declined and finished-product inventories piled up. Consequently, operating rates at domestic tire manufacturers continued to fall, leading to a marked contraction in procurement demand for BR. Downstream factories largely restocked at low levels based on immediate needs, with a widespread tendency to push for lower purchase prices. Meanwhile, profitability was poor in key downstream sectors such as ABS and SBS; companies showed little enthusiasm for production, operating rates remained low, and there was little willingness to actively restock raw materials, resulting in sluggish market trading. Only the latex sector maintained a small amount of essential procurement, but the overall volume was insufficient to reverse the market's weakness, further fueling bearish sentiment.

According to monitoring by the SunSirs commodity market analysis system, domestic market prices for 1,3-butadiene rubber have recently continued to decline. Data from SunSirs shows that as of June 26, the price of 1,3-butadiene rubber in East China stood at 12,830 RMB/ton, down 1.38% from 13,010 RMB/ton at the end of February; meanwhile, the closing price of the main 1,3-butadiene rubber futures contract fell to 11,810 RMB/ton. These declines have completely erased the gains driven by geopolitical conflicts in the Middle East, returning prices to the baseline range seen prior to the outbreak of the conflict.

Market Outlook:

Based on an analysis of market fundamentals for June, the domestic 1,3-butadiene market is unlikely to see a significant shift from its current weak trend in the short term; prices will likely continue to fluctuate at low levels. On the cost side, there are no immediate expectations for a boost, as crude oil and feedstock prices remain weak, offering little support to spot prices. Regarding supply, overall availability is ample and inventory accumulation pressure persists, meaning selling pressure is unlikely to ease in the near term. On the demand side, the traditional off-season continues; operating rates in downstream sectors—such as tires and ABS—are unlikely to see a substantial rebound, and the boost from essential demand remains limited. Consequently, a wait-and-see attitude and cautious purchasing will continue to dominate market activity. Overall, the 1,3-butadiene market lacks the momentum for a near-term rebound, with prices expected to undergo weak consolidation. Moving forward, key factors to monitor include crude oil trends, the recovery of downstream operating rates, and fundamental shifts resulting from changes in plant maintenance schedules.

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