SunSirs: China BR Market Rose significantly in September and Weakened at the End of the Month

In September, the market for BR significantly increased, but weakened at the end of the month. According to the Commodity Market Analysis System of SunSirs, as of September 28th, the market price of BR in East China was 13,280 RMB/ton, an increase of 10.94% compared to 11,970 RMB/ton at the beginning of the month, and a decrease of 4.32% compared to the high point of 13,880 RMB/ton within the month.

At the beginning of the month, the price of raw material butadiene increased significantly, with strong cost support for BR. Downstream tire factories were operating steadily, and tire companies were stocking in a centralized manner. This supported demand for BR, leading to a significant increase in the factory price of BR and a significant increase in the BR market; At the end of the month, the price of raw material butadiene has slightly decreased after a high consolidation, and the cost support for BR has weakened. On the other hand, as the dual reserve period approaches its end, market transactions are light, and the main suppliers of BR have continuously lowered their factory prices. The high price of BR market has declined. As of September 28th, PetroChina Northeast Sales Company's Daqing Shunding Northeast Warehouse has raised its price by 13,000 RMB/ton. The domestic market quotation range for two barrels of oil BR is around 13,000-13,400 RMB/ton, and the quotation for private enterprise BR is between 12,500-12,900 RMB/ton.

In September, the natural rubber market first rose and then fell, but overall it was lower than the price level of styrene BR, which had a relatively negative impact on BR. According to the Commodity Market Analysis System of SunSirs, as of September 28th, the price was at 12,540 RMB/ton, an increase of 1.24% from 12,386 RMB/ton at the beginning of the month, and a decrease of 2.64% from the high point of 12,880 RMB/ton within the month.

Demand side: The overall stability of tire production in September has continued to demand support for rubber, and tire companies are stocking up before holidays in the middle of the month, resulting in a certain increase in rubber demand. It is understood that as of late September 2023, the operating load of all steel tires for rubber tire enterprises in Shandong region is 6.4%; The operating load of semi steel tires for domestic rubber tire enterprises is 7.2%.

Analysts from SunSirs believe that after a significant increase in raw material prices, there will still be some support for the cost of BR. Currently, downstream construction will support the demand for rubber, and the short-term supply of BR will be stable. It is expected that the spot market of BR will fluctuate and consolidate at a high level in the short term.

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