Sneak Peek of China SBS Annual Data 2022
Introduction: China’s supply and demand fell significantly in 2022, while the export volume hit a record high. China’s SBS supply is predicted to drop by 16.51% Y-O-Y in 2022, the consumption volume to fall by 20% Y-O-Y and the export volume to rise by 150% Y-O-Y.
China’s SBS capacity utilization rate declined greatly, and output dropped Y-O-Y significantly.
There was no newly added SBS capacity in China, but the capacity basis was relatively large. China has 14 SBS producers currently, with the total capacity of 1,600kt/a. China’s SBS capacity utilization rate is estimated at 52% in 2022, down 9% Y-O-Y. China’s SBS output is predicted to drop by 15.34% Y-O-Y. Major SBS producers saw marginal benefit losses against the backdrop of high prices of international crude oil. Related additives, especially initiators were in short supply. Meanwhile, many SBS units underwent scheduled maintenance. As a result, China’s SBS output declined in 2022. In terms of import, China’s SBS import volume is predicted to drop by 28% or so Y-O-Y. Major suppliers focused on European and American markets for arbitrage, lowering supply to China. Besides, China’s demand was weak. Thus, the import volume slid.
Consumption volume of SBS from all downstream fields may diminish.
The consumption volume of SBS from downstream shoe material, modified bitumen and modified bitumen waterproof roll fields dwindled in 2022, and the annual consumption volume is predicted to fall by 20% Y-O-Y. Changes in the capital, export environment faced by downstream products and real estate industry exerted influences on China’s SBS downstream industries.
TPR shoe material: The transfer of footwear orders to Southeast Asia sped up. Meanwhile, the operating rate of China’s TPR shoe material industry significantly declined, due to scant orders at home. The consumption volume of SBS from this industry is predicted to take up 28% of the total in 2022, down 3% Y-O-Y.
Modified bitumen industry: China’s macroeconomy underperformed in 2022. Freeway projects progressed slowly, restrained by factors such as capital, and the construction of some projects was postponed. Therefore, the consumption volume of modified bitumen greatly decreased, impacting the consumption of SBS. The consumption volume of SBS from this industry is predicted to take up 38% of the total in 2022, rising Y-O-Y, but the consumption volume dwindled.
Modified bitumen waterproof roll: The real estate industry impacted the development of China’s waterproof roll market. Some enterprises reduced account period transactions or shortened payment days to avoid risks, leading to a great decrease in the output of modified bitumen waterproof roll. In addition, some enterprises reduced the modifier addition, due to market competition and cost pressure. The consumption of SBS from this industry greatly declined. The consumption volume of SBS from the industry is predicted to take up 18% of the total in 2022, down 3% Y-O-Y.
China’s SBS export volume hit a record high in 2022.
China’s SBS export volume is predicted to increase by about 150% Y-O-Y in 2022. As seen from the global trade flow, the European market saw demand gap. European SBS supply capacity weakened in 2022. The geopolitical escalation caused limitations on a European country’s SBS resources to Europe. In terms of the global capacity layout, over 70% of SBS capacity was concentrated in Asia, and Europe more relied on resources from Asia. Demand for SBS in the U.S. was strong in 2022, so China’s SBS exports to the U.S. hiked.
As for China’s SBS market operation features, demand in China’s market underperformed. Thus, China’s enterprises focused on exports to solve overcapacity. Overseas SBS market prices were higher than China’s ones, on the whole, providing arbitrage opportunities. Some of China’s SBS grades occupied some European markets, which provides a prerequisite for China’s SBS export growth.
Overall, China’s SBS market annual data fell short of expectations in 2022. Yet, with expected state macroeconomic regulation and control, the real estate, road infrastructure and traditional manufacturing industries are likely to change a lot. Besides, with major enterprises such as Sinopec enhancing the layout in coastal regions, SBS export is predicted to still gain market attention in the future. It is envisaged that China’s SBS supply and demand fundamentals will improve in 2023.
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