In March 2025, the Butyl Rubber market in the US witnessed a decline in its trend after inclining for two consecutive months. This decline can be attributed to the declined production cost and rate of butyl rubber. However, the downstream automotive sector sales witnessed an incline but it did not uplift the demand for butyl rubber amid the presence of ample inventory levels. Moreover, the tariff uncertainty continued to impact the market sentiments in the US.

This month, the Butyl Rubber market in the US experienced bearishness in its trend with a decline of 4.73%. The bearishness in the butyl rubber market can be related to the declined production cost of the commodity. The production cost of butyl rubber declined amid a decrease of 0.8% in the feedstock isobutylene. Furthermore, the demand for butyl rubber from the downstream automotive sector experienced limitations due to the presence of ample inventory levels along with the ongoing market uncertainty.

Moreover, the trade tariff is causing disruptions in the global automotive sector. The trade tariff was not implemented in March but the possibility of it made the market players hesitant and they avoided increasing their discounts despite the rising inventory levels. As they were expecting a price hike with the implementation of the tariff. In addition, business confidence witnessed a decline in March due to the uncertainty over federal government policies which further weighed on the market Outlook.

During this month, in the downstream automotive sector, a significant surge was witnessed in sales amid the expected price hike due to the planned implementation of trade tariffs. The US government is anticipated to impose a 25% tariff on imported passenger cars as well as light trucks on April 3. This made buyers adopt rush purchases ahead of the expected price surge. This was reflected in the increased sales of the automotive. In March, the automotive sales witnessed a year-over-year incline of 9.1% and a month-over-month rise of 3%.

Therefore, amid the availability of ample automotive inventory levels, the manufacturers lower their production rates. This further limited the demand for Butyl Rubber from the downstream automotive sector. Hence, the market players lowered their butyl rubber ex-quotations to reflect the current market sentiments in the US. In addition, the spread between isobutylene and butyl rubber narrowed signaling the bearish market sentiments in the US during March 2025.

As per ChemAnalyst, the butyl rubber market in the US is expected to showcase cautiousness in the upcoming weeks with the announcement of the trade tariff. The US is preparing to implement a 25% tariff on all imported passenger cars and light trucks from April 3 which is expected to increase both wholesale and retail prices.