Asian butadiene prices are at a three &
half year low amid weak demand and a glut of synthetic rubber stocks. The
export of synthetic rubber feedstock fell 32% m-o-m in May to 16,458 tonnes,
from South Korea. China Petroleum and Chemical Corp (Sinopec), slashed its
ex-works prices for styrene butadiene rubber by 5-6% effective Wednesday.
Sinopec Qilu Petrochemical is offering SBR1502 in East China at Yuan 10,700/mt,
or about $1,364/mt on an import parity basis. The price cuts are a result of
poor demand and high synthetic rubber stocks in China.
Rubber at Qingdao, which makes up the bulk of
China's inventories, has been offered at a discount to prices in Southeast
Asia, after stocks rose well above the usual level of 250,000 tonnes,
indicating ample supply. Rubber prices were at multi-year lows as Chinese tyre
makers have been forced to reduce imports and turn instead to country's bonded
warehouse supplies and also U.S and European demand for the commodity at its
low.
The shortage of natural rubber is hitting the
operations of rubber goods manufacturing sector and this situation is pushing
up domestic prices (at `.189 a kg), now higher by `.28 a kg compared to RSS3 grade, which closed at `.160.39 a kg at Bangkok and Malaysian SMR20 closing at
`.133.66 a kg, setting the stage for a likely surge in
import of natural rubber or for implementation of new duty structure. While
Tokyo Commodity Exchange, December futures series closed at ¥246.9 a kg, after
touching a low of ¥241.3 and a high of ¥247.7a kg.
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