China Butadiene Market Fluctuated Upwards

In recent three months, China’s butadiene market fluctuated upwards overall. Especially since July, the butadiene market saw ups and downs frequently, and butadiene prices remained at a high level. The upward and downward ranges were both limited.

Early this week, the base auction price at North Huajin Chemical Industries was RMB 12,600/mt. Downstream markets underperformed and Sinopec cut the SBR prices, thus some players adopted a bearish stance to this auction. However, the order of auction resources was done at RMB 12,805/mt to a trader beyond some players’ expectations. Besides, there were no spots at Sinopec flowing into the market, bolstering the market price to hit a new high. Delivered prices of butadiene fluctuated within RMB 13,800-13,900/mt in Shandong and RMB 14,000-14,200/mt in East China respectively.

For the time being, butadiene resources at Sinopec were mainly for self-use or provided mutually. There were no spots at Sinopec flowing into the market. Other sales enterprises held limited merchantable resources. Available butadiene resources were sparse at Shandong enterprises. Shandong Weite Chemical shut down the butadiene unit and mainly consumed the resources for self-use. The unit was almost unlikely to be restarted in September. The PBR unit at Zibo Qixiang Tengda Chemical started up, without many resources available. Shandong Huayu Rubber mainly produced butadiene resources for self-use, without plan for selling in the market. As seen from northeast producers, some butadiene resources at North Huajin Chemical Industries were provided to Liaoning North Dynasol Synthetic Rubber. PetroChina Fushun Petrochemical mainly produced the butadiene resources for mutual supply or self-use. The butadiene output at PetroChina Liaoyang Petrochemical was limited. Overall, the whole butadiene supply was insufficient.

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