Active Demand Fundamentals Strengthen the Global NBR Market Outlook
- 19-Sep-2022 3:46 PM
- Journalist: Henry Locke
The prices of Nitrile Butadiene Rubber (NBR) have remained steady and demonstrated bullish market sentiments. With the strengthening concept of global hygiene, the profound use of gloves has been accelerating the market growth of NBR across the regional markets. However, the ongoing energy crisis and increases in electricity prices in the European region have pressured the manufacturing capacities of certain elastomers, including Nitrile Butadiene Rubber. Many industrial plants are shutting down or reducing their production in Europe. As a result of massive plant curtailments, Europe's dependency on other markets has increased for the strategic supply chains of NBR.
In Germany, the price trend of NBR witnessed an increment of USD 5 per tonne in the third week of September 2022. As per the observed market scenario, the obstructed port operations in Germany have caused a domino effect on the supply chain of various commodities. The logistic challenges and strikes at European ports have further dampened the trade movement with the overseas market players. In addition, the active demand from the downstream tire and glove industries has intensified the market outlook of NBR among traders.
On the other hand, in South Korea, a key market player, Kumho Petrochemical, has announced a significant investment initiative (approx. €5.5 billion), aiming to boost the NBR production in the domestic region. The ChemAnalyst database shows that the NBR prices have remained steady, as observed on September 16th, compared to the last week's prices. Furthermore, the recent meeting of China's top legislator, Li Zhanshu, with the officials of South Korea to strengthen supply-chain cooperation has further solidified the bilateral trade relations between these Asian countries. In addition, the solid downstream demand fundamentals in the US market have stabilized the price trend of NBR in the same timeframe.
As per ChemAnalyst, the market dynamics of Nitrile Butadiene Rubber are likely to remain buoyant in the near term. The anticipated recovery in advanced economies and emerging markets such as China and India will further boost the automotive sector, enhancing the price value chain of Nitrile Butadiene rubber in the forthcoming weeks.
