SBR Output to Slide, Driving Up SBR Price
Snapshot: Up to June 2023, there have been 11 ESBR enterprises in China, with the capacity of 1,460kt/a in total. Samples of this research cover all China’s ESBR enterprises, including 2 ESBR enterprises in North China, 4 in East China, 2 in South China, 2 in Northeast China and 1 in Northwest China.
In June, the ESBR output declined M-O-M.
According to SCI, the ESBR output in June was around 82.8kt, down 2.24% M-O-M and down 6.78% Y-O-Y. The main reason was that the output of the SBR units at Sinopec Qilu Company and PetroChina Lanzhou Petrochemical decreased. The ESBR output in June fell by 8kt. The output of the SBR units at PetroChina Jilin Petrochemical and Nanjing Yangzi Petrochemical and Rubber increased, but the increment failed to offset the decrement. The SBR output decreased by 1.9kt or so in June. The units at Tianjin Lugang Petroleum Rubber and Fujian Fuxiang Chemical remained offline.
In June, the SBR market price trended at lows. The decrement in the price of natural rubber narrowed, and the price inched up for a short time. The SBR supply shrank. Some traders tried to raise the SBR price, but the spot dealing atmosphere was tepid. Thus, the SBR price faced headwinds in rebounding. The gross profit of China’s ESBR industry in June was RMB 1,547.4/mt, up RMB 686.9/mt. The prices of butadiene and styrene both trended down. The monthly average price of SBR also slid, but the decrement was lower than that in the feedstock prices. Thus, the gross profit of the SBR industry increased notably. Amid current profit, the output of the SBR units maximized in June. The supply of SBR was relatively normal.
The total ESBR output is expected to see a M-O-M decrease in July.
According to SCI, the ESBR output in July may be around 75.2kt, down 9.18% M-O-M but up 2.77% Y-O-Y. In July, PetroChina Lanzhou Petrochemical, Hangzhou Yibang Rubber and Shen Hua Chemical Industrial are expected to cut production. The SBR unit at Nanjing Yangzi Petrochemical and Rubber may be under normal production, but the increment in the output may fail to offset the decrement. Overall, the total SBR output in July is likely to fall by 7.6kt or so. The units at Tianjin Lugang Petroleum Rubber and Fujian Fuxiang Chemical will possibly continue to be offline.
In July, the SBR price is expected to move up. As for the supply, the SBR output may decrease, bolstering the SBR price. The export orders of semi-steel tires are likely to keep improving, and tire enterprises may produce winter tires intensively, underpinning the operating rate at semi-steel tire enterprises. Yet, the spot dealings of SBR are predicted to hardly improve. Besides, the natural rubber price may be range-bound. The price of spot natural rubber resources will continue to be lower than that of SBR. There may be limited bullish factors on the supply side. Therefore, it is projected that the SBR price is estimated to trend up, but the increase may not last long.
All information provided by SCI is for reference only, which shall not be reproduced without permission.
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