Los Angeles (USA): The US Styrene Butadiene Rubber (SBR) market is currently experiencing price stability, driven by demand from tire and electronics gadget manufacturers. SBR prices are hovering around USD 1800/MT, CFR USGC in mid-December 2023, amid moderate sales and stockpile availability with end-use manufacturing units. The market dynamics remain moderate, and SBR retailers are facing fewer commodity inquiries. Meanwhile the market activity has slowed a notch in the US market, as US braces for the winter holidays.

Bluebird Corporation, a major heavy vehicle manufacturer, is navigating this landscape by focusing on overall business improvements and responding to tire demand. The company has sold a qualitative volume of buses and cars, with a healthy backlog of 4,600 units for Blue Bird school buses at the end of Q4, positively impacting pricing, production stability, and profit margins.

Despite industry-wide supply chain constraints, Bluebird actively manages the situation by collaborating with suppliers and supporting their plants. The company is reinvesting in its business by upgrading facilities, improving processes, and expanding electric bus capacity for its new EV production center, consequently raising the demand for SBR in the domestic market. These strategic investments, along with a dedicated workforce, strong leadership, and lean process improvements, have transformed the revenue structure compared to a year ago.

As the tire industry seeks supply chain normalcy, US consumers eyeing new vehicles in 2024 may face challenges due to high-interest rates, stringent credit conditions, and slow SBR price reductions. This uncertainty suggests a moderately progressing auto and tire sales environment for the upcoming year, significantly impacting the overall SBR price range in the domestic market. While SBR and tire supply chain conditions have improved since 2022, concerns linger about a structural deficit in semiconductor capacity, especially for older nodes, with potential constraints resurfacing as demand from other sectors rebounds.

In the broader market context, ocean carriers within THE Alliance are maintaining the suspension of a trans-Pacific West Coast and Asia-Europe container service in their 2024 network plan. However, they plan to reinstate two other services to the Pacific Northwest and the US East Coast, compensating for the suspensions by expanding port coverage and utilizing Panama Canal routes for certain US services.

Several factors influence SBR prices, including delivery charges from the Asian market, feedstock (styrene and butadiene) prices in the exporter's market, and demand strength from end-use manufacturing units. According to ChemAnalyst, SBR prices are expected to remain slow and steady towards the quarter-end, gaining strength in upcoming quarter.