Jun SBS Imports Decreased with Major Imported Resources Under Sales Pressure
Snapshot: In June, China’s SBS imports declined notably. Major imported resources came from Russia. Imported SBS resources in China’s market faced difficulties in sales, leading to a notable decrease in the SBS import volume in June.
According to GACC, the SBS import volume trended down M-O-M in June. In June 2023, China’s total SBS import volume was 7,103.61mt, down 40.45% M-O-M and up 290.95% Y-O-Y. From January to May, the increment in China’s SBS imports hit a record high. The total SBS import volume reached 40kt or so from January to May. Some major imported grades circulated slowly in China’s market, resulting in a large pileup of inventory. Besides, due to cost pressure on major producers and traders, China’s market began to consume the inventory of major imported resources from June.
According to GACC, China’s imports of dry SBS resources from Russia was 5,392.56mt, accounting for 78% of the total in June, ranking first. The imports from Taiwan, China took up 9% of the total, ranking second. The imports from Japan accounted for 7%, ranking third. In June 2023, the import structure of oil-extended SBS changed slightly. The imports of oil-extended SBS from Taiwan, China took up 65% of the total, ranking first. The imports from U.S. and HK, China accounted for 10% respectively, tied for second.
The imported SBS resources from Russia reached 37kt, accounting for 79% of the total SBS imports in H1, 2023. Yet, sales of SBS in China faced pressure in June, so the market prices trended down. Especially in the dry SBS market, players held bearish sentiments. Curbed by the sliding butadiene price, the SBS cost declined. With the expected tepid downstream demand and supplement of dry SBS resources produced by Hainan Baling Chemical New Material, the SBS supply increased somewhat. Due to several bearish factors, the market prices of general dry SBS crashed and gradually bottomed out in late June.
From the perspective of the SBS import market trend, China’s SBS imports are likely to decline as the SBS unit at Hainan Baling Chemical New Material may run at a higher load, and the inventory of imported resources may stay high. However, due to the relatively small shares in other overseas markets, China’s major import trade partner highly depends on China’s market. Thus, it is projected that China’s SBS import volume is expected to maintain a high base. In August, a severer oversupply may be seen in China’s SBS market. In particular, the SBS supply is predicted to increase, weighing on the increment in the SBS prices.
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