2013 synthetic rubber prices are weak

In the first half of 2012, the world's synthetic rubber supply and demand growth all declined slightly year-on-year, and demand growth accelerated in the second half of the year. It is estimated that the annual demand will be 15.37 million tons, which is an increase of 2.7% from 2011. In 2013, the global demand for synthetic rubber will reach 15.94 million tons, accelerating growth.

According to data from the World Rubber Research Organization (IRSG), from January to June 2012, global synthetic rubber production was 7.507 million tons, a year-on-year decrease of 1.2%; consumption was 7.516 million tons, a year-on-year decrease of 0.4%.

As far as China is concerned, in the second half of 2012, the domestic newly-added capacity of synthetic rubber has increased significantly, with the addition of 360,000 tons and 280,000 tons of butadiene-butadiene rubber and styrene-butadiene rubber, respectively. By the end of 2012, the total production capacity of butadiene rubber and styrene-butadiene rubber reached 1.325 million tons and 1.592 million tons respectively. By the end of 2012, the total domestic synthetic rubber capacity was 4.67 million tons/year, and 1.14 million tons/year was added during the year.

In 2013, the production capacity of synthetic rubber continued to increase, with butyl rubber and styrene-butadiene rubber increasing by 400,000 tons/year and 150,000 tons/year. Taking into account the supply of raw materials, downstream demand, new capacity, etc., it is expected that the output of these two varieties in 2013 will be 1.36 million tons and 920,000 tons, respectively, an increase of 15.3% and 19% from 2012, and the utilization rate of the equipment will decrease.

In 2013, the demand for synthetic rubber will continue to grow, but the growth rate is flat or slightly lower than 2012.

In terms of styrene-butadiene rubber, demand will increase at a rate of 6.4%, driven by the recovery and export of the automotive industry. The annual demand is expected to be 1.49 million tons. At the same time, due to the increase in production capacity, the utilization rate of the equipment decreased, and the increase in output was still 9%. Net imports continued to decrease, with imports of ESBR (sugar styrene-butadiene rubber) showing a decreasing trend and imports of SSBR (soluble styrene-butadiene rubber) increasing.

In terms of butadiene rubber, demand growth will be slightly faster than that of styrene butadiene rubber, driven by the recovery of commercial vehicles. The annual demand is expected to be 1.02 million tons, an increase of 7% year-on-year. However, due to the increase in production capacity, the utilization rate of the equipment decreased, and the increase in output was 19%. Net imports have decreased significantly and imports are still dominated by generic butadiene rubber products.

In terms of raw material butadiene, despite the rapid increase in the domestic supply capacity of synthetic rubber, the decrease in device utilization will affect the demand growth of butadiene. It is expected that domestic butadiene will be less likely to rise sharply due to tight supply in 2013, and supply and demand will be basically balanced. The price will fall from 2012, and the restricting effect on synthetic rubber will be weakened.

International economic analysis and consulting agency IHS believes that from the perspective of the world's major butadiene trade, net imports and net exports of the United States and Western Europe in 2012 were 219,000 tons and 147,000 tons respectively; in 2013, the United States’ net imports will be With a reduction of 87,000 tons, net exports from Western Europe decreased by 63,000 tons. Without considering other regions, the supply of butadiene in the world in 2013 was loose.