PBR Prices Surge globally, US Shows Marginal Increase Amid Destocking, Asia witness Uptrend with Demand Rise

In the global market, the price of Polybutadiene Rubber (PBR) has witnessed a notable surge during H2 May 2024. This increase is primarily linked to the rise in feedstock Butadiene prices, driven by positive downstream market demand. In contrast, the PBR price in the US market had witnessed a gradual rise in price trend from the past two weeks. Still, the market is deteriorating affected by tepid purchases despite the significant rise in Butadiene prices. The continued destocking of inventories in the US extended through this week, with no marked increase in demand from the Tire OEM and Replacement markets. These factors have cumulatively influenced the global PBR price, highlighting regional disparities in market dynamics.

In the US market, the price of Polybutadiene Rubber (PBR) saw a slight increase in H2 May amidst ongoing destocking trends. Continental Tire the Americas LLC's substantial USD 1.5 billion investment in its US tire manufacturing operations, including plants in Mississippi and Illinois, has pushed its total annual production capacity beyond 16 million tires. However, foreign exchange fluctuations led to a 2.5% decrease in sales, and volumes declined by 1.6% due to sluggish original equipment (OE) sales and persistently subdued truck markets, particularly in Europe. Additionally, the price/mix suffered a 0.3% decrease due to adverse cost indexation effects and an unfavourable mix from weak truck tire sales. Despite these challenges, the continued destocking of inventories has kept the price from showing significant upward momentum. As of this week, the price of PBR halted at 1665 USD/MT FOB-Texas.

In H2 May, the price of Polybutadiene Rubber (PBR) surged in the Asian market, particularly in South Korea. Nexen Tire reported stable total vehicle production for original equipment (OE), despite a slowdown in electric vehicle (EV) production due to delays in confirming government subsidies. Nexen also noted an expansion in sales of high-value-added products, such as 18-inch or larger tires. The company is actively increasing OE supply to EVs, aligning with their export-focused strategy for Hyundai-Kia Motor Company's China plant. Demand concentration in the Middle East during the first quarter has led to continuous efforts to expand market share in emerging markets and enhance brand awareness. Suppliers are actively engaged in bulk accumulation of inventories to respond to current market dynamics. As of this week, the price of PBR halted at 1830 USD/MT FOB-Busan.

According to ChemAnalyst, the price of Polybutadiene Rubber (PBR) is expected to showcase stable to bearish momentum in the upcoming sessions in the US market. This anticipation in the PBR price is primarily linked to the ongoing destocking of inventories from suppliers, which has not shown any signs of reversal or inventory accumulation. In contrast, the Asian market is expected to exhibit bullishness due to strong demand, particularly from the automotive sector, which is currently on a positive run. Market participants in Asia are actively accumulating inventories as the PBR prices continue to trend upward, a trend expected to persist in the coming sessions. These factors will cumulatively influence the global PBR market, with the US market likely seeing stable to bearish trends while the Asian market remains bullish.