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European styrene butadiene rubber producers raise offers by Eur50-100/mt citing feed hikes

2015/6/8      view:
European and Russian styrene butadiene rubber producers have hiked their offers for June- and July-loading cargoes by Eur50-100/mt this week citing a rise in feedstock butadiene and styrene prices, several trade sources said. 

Butadiene constitutes 70% per unit of SBR, styrene constitutes 20% with vinyl and nitrile rubber constituting the rest 10%. 

Offers for SBR 1500 and 1502 grades have been raised to Eur1,300-1,350/mt FD NWE this week from the earlier Eur1,250/mt FD NWE. 

This includes those from producers from Russia who as a rule usually sell their cargoes at a lower price than the European producers. 

"Producers had been waiting to raise their offers for a while but what triggered the recent rise in offers was the high settlement of June's butadiene contract price," a trader said. 

The NWE butadiene contract price for June was fully settled at Eur685/mt ($772/mt) FD NWE, up Eur45/mt from the May contract price on May 28. 

Spot butadiene prices have risen more than 41% since end-January, Platts data showed. 

SBR prices were assessed at $765/mt FOB Rotterdam Thursday. 

Prices have risen consistently since being assessed at a five-year low of $450/mt FOB Rdam on January 31. 

Current European styrene prices are the highest globally on the back of ongoing outages. NWE styrene monomer barges loading 5-30 days forward were assessed at $1,361.50/mt FOB ARA Thursday, up $18.50/mt day on day on the back of tight supply fundamentals for prompt material. 


Sturdy tire demand fueled by a consistent rise in automobile sales in Europe has lent further support to 1500 and 1502 grades of SBR, market sources said. 

New passenger car registrations in the EU increased for the 20th consecutive month in April, rising 6.9% year on year to 1,166,482 units and recording the best result in terms of volume for the month of April since 2009, ACEA, the European auto manufacturers' association, said in May. 

"[SBR] demand in tires within Europe is coming from vehicles meant for export as well. A good share of vehicles produced in Germany are exported," a European trader said earlier this week. 

Tire demand in Europe from new vehicles rose 4% year on year in April 2015, according to the latest figures from French tire producer Michelin. 

Overall SBR demand in Europe is estimated to be growing at 5% annually. About 70% of SBR lands into tires production according to market estimates.