SBR Operating Rate to Decrease, Bolstering SBR Price
Snapshot: Up to end-April 2023, there are 11 ESBR enterprises in China, with the capacity of 1,460kt/a in total. Samples of this research covers all China’s ESBR enterprises. There are 2 ESBR enterprises in North China with the capacity of 350kt/a, 4 in East China with the capacity of 470kt/a, 2 in South China with the capacity of 150kt/a, 2 in Northeast China with the capacity of 340kt/a and 1 in Northwest China with the capacity of 150kt/a.
In April, the operating rate of the ESBR industry trended up M-O-M.
According to SCI, the operating rate of the ESBR industry was 73.61% in April, up 3.53% M-O-M. The operating rate at Shen Hua Chemical Industrial, Zhejiang Vitile Rubber and Hangzhou Yibang Rubber climbed. Other ESBR units were under normal production. Overall, the operating rate of the SBR industry ramped up M-O-M.
According to SCI, the operating rate at Shen Hua Chemical Industrial, Zhejiang Vitile Rubber and Hangzhou Yibang Rubber climbed M-O-M. The operating rate of the SBR units at Sinopec Qilu Company, Nanjing Yangzi Petrochemical and Rubber, PetroChina Jilin Petrochemical and PetroChina Fushun Petrochemical saw no obvious change. The decrement in the prices of butadiene and styrene was larger than that in the SBR price, resulting in lower losses of the SBR industry. Considering stable supply, some SBR enterprises which purchased butadiene outside increased the operating rate. On the whole, three enterprises increased the operating rate, no enterprises cut the operating rate and the other enterprises maintained stable operating rate. The SBR units at Fujian Fuxiang Chemical and Tianjin Lugang Petroleum Rubber remained offline.
In April, the SBR market price trended up. The prices of butadiene and natural rubber rose after falling, underpinning the atmosphere of the SBR market. Besides, some SBR units were expected to take maintenance, driving up the SBR market price. The downstream tire industry purchased on rigid demand. The gross profit of China’s ESBR industry in April was RMB -182.2/mt theoretically, up RMB 111.3/mt. The average price of SBR moved down in April. The decrement in the average prices of butadiene and styrene was large. The profit in the industrial chain transferred to the SBR industry. Thus, the profit at China’s ESBR producers increased notably.
According to SCI, PetroChina Fushun Petrochemical is scheduled to run its unit at a higher load in May. PetroChina Jilin Petrochemical may cut the operating rate. Huizhou LCY Elastomers plans to shut its unit for seven days. Nanjing Yangzi Petrochemical and Rubber is expected to shut its unit at the beginning of May. Other SBR units may run normally. It is projected that the operating rate of the SBR industry may be around 65% in May, down 8% M-O-M.
The SBR unit at PetroChina Lanzhou Petrochemical may be shut for around 45 days in June. In Q2, the losses of SBR supply will possibly reach around 24kt. Based on the expected intensive maintenance, SCI predicts that the SBR supply may bolster the SBR price in a short term.
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