Nitrile Butadiene Rubber Prices Show Bearish Trend in Europe at the End of Q2 2023

With the conclusion of the second quarter of 2023, the prices of Nitrile Butadiene Rubber have settled lower end across the European market. The largest European economy, Germany, has been battling high inflation, sapping the demand for Nitrile Butadiene Rubber from the downstream market. In early 2023, the rising energy prices were the primary contributor to the record-high inflation in the Eurozone area. According to the market players, the value of the euro has declined due to Germany's higher inflation rate, leading to a lower exchange rate in comparison to the dollar.

According to the ChemAnalyst database, the prices of Nitrile Butadiene Rubber have plunged by approximately 7% on an m-o-m basis in the domestic region of France. As per European Automobile Manufacturers Association, From January to May 2023, the EU car market expanded by 18% to 4.4 million registered cars. Despite market improvement in May, year-to-date sales are still 23% lower compared to the same month in 2019, when 5.7 million units were registered, weakening the market fundamentals of Nitrile Butadiene Rubber. The automotive sector has been gradually strengthening and benefitting the industrial sectors. However, the market players were cautious as the high inflation levels have still been moderating the growth prospects of the French economy.

Furthermore, the successive interest rate hikes by European Central Bank have limited the trade activities in the key exporters of Nitrile Butadiene Rubber, France, and as a result, the manufacturers have refrained from any major price shift in Nitrile Butadiene Rubber to protect the demand fundamentals from the domestic region and importing nations, including Germany. In addition, the cost support from Acrylonitrile and Butadiene was also insufficient, reported by market participants. However, in May, the German Association of Automotive Industry data depicted that the new registrations of Passenger Cars reached a figure of 246,966 units, up by 19% every month in May. Despite it, the prices of Nitrile Butadiene Rubber have been progressing southwardly since the June start due to the ample availability of the product with the downstream automotive manufacturers.

According to the pricing intelligence of ChemAnalyst, the pricing dynamics of Nitrile Butadiene Rubber might remain on the lower end in the regional markets in the wake of limited procurement from the downstream automotive industries. The cost supply from upstream raw materials is also anticipated to be inadequate in the forthcoming weeks. In addition, the European Central Bank has indicated the possibility of another interest rate hike amid sticky inflation in the domestic region and will continue to pressure the purchasing power of the Nitrile Butadiene Rubber end-use industries.