SunSirs: Narrow Range Fluctuations in China SBR Market

Recently (12.29-1.5), the SBR market has experienced a narrow range of fluctuations. According to the Commodity Market Analysis System of SunSirs, as of January 5th, the price of SBR in the East China market was 12,383 RMB/ton, a decrease of 0.07% from last Friday's 11,391 RMB/ton, and the highest point in the cycle was 12,425 RMB/ton. At the end of December, due to the negative impact of Qilu Petrochemical's butadiene benzene unit, the market expected tight supply and higher prices; Later, as the load of Qilu Petrochemical's butadiene benzene unit gradually increased, the market's expectations for the supply side returned to loose expectations, and prices slightly fell from high levels. According to the Commodity Market Analysis System of SunSirs, as of January 5th, Sinopec North China Sales Company reported a factory price of 12,200 RMB/ton for Qilu Butadiene 1502. The market has returned to rationality, and as of the 5th, the mainstream market price of SBR in Fushun, Jihua, and Yangzi in East China is around 12,200-12,600 RMB/ton.

Recently (12.29-1.5), the price of raw material butadiene has risen, while the price of styrene has fluctuated narrowly, continuing to support the cost of SBR. According to the Commodity Market Analysis System of SunSirs, as of January 5th, the price of butadiene was 8,750 RMB/ton, an increase of 2.04% from last Friday's 8,575 RMB/ton; As of January 5th, the price of styrene was at 8,510 RMB/ton, a decrease of 0.58% from last Friday's 8,560 RMB/ton, and the lowest point in the cycle was 8,440 RMB/ton.

Recently (12.29-1.5), the overall construction of domestic SBR plants has remained stable with a slight increase.

Demand side: Due to the increase in equipment maintenance by tire companies during holidays, overall tire production has declined, resulting in a weakening demand for rubber. It is understood that as of early January 2023, the operating load of all steel tires in rubber tire enterprises in Shandong region was around 460%; The operating load of semi steel tires in domestic rubber tire enterprises is around 70%.

SunSirs analysts believe that although the cost of SBR is supported, the supply of SBR will still be relatively loose in the later stage. In addition, downstream tire demand support is weak, and it is expected that the SBR market will fluctuate and consolidate in the later stage.

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