Isoprene Rubber Prices Decline in the US Market; Potential Rebound Expected
Isoprene Rubber Prices Decline in the US Market; Potential Rebound Expected

Isoprene Rubber Prices Decline in the US Market; Potential Rebound Expected

  • 07-Jun-2023 4:41 PM
  • Journalist: Patricia Jose Perez

Texas, USA: In May, the prices of Isoprene Rubber in the USA market experienced a consistent decline for the third consecutive month. A significant drop of 2.7% was observed in May, following a notable decline of 7.7% in April 2023. This downward pricing trend was not exclusive to Isoprene Rubber alone, as various other synthetic rubber types also experienced declining prices during the same period. Typically, the second quarter of the year is a notable period for growth in the elastomers market. However, this year has been different, as the unstable U.S. economic conditions have likely contributed to the continuous plunge in Isoprene Rubber's market trend. Nevertheless, a slight upward shift in Isoprene Rubber prices was observed during the first week of June.

Interestingly, the decline in the Isoprene Rubber market cannot be attributed to the downstream automotive sector this time. The automotive industry has been resilient, exhibiting improved performance despite the challenging economic conditions. In May, the Seasonally Adjusted Annualized Sales (SAAR) for light vehicles reached 15.14 million units, an increase from 12.73 million units in the previous year. Major American automakers, including Tesla, Ford, and General Motors, experienced annual sales growth of 37.9%, 10.5%, and 27.7%, respectively. These figures indicate the outstanding market performance of the downstream automotive sector, resulting in increased usage of Isoprene Rubber.

However, the U.S. manufacturing sector contracted once again in May 2023, with the Purchasing Managers' Index (PMI) registering at 46.9, a 0.2% decrease from April. May marked the seventh consecutive month of PMI contraction in the USA, perpetuating the downward trend in the country's manufacturing sector. Additionally, the new order index entered the contraction territory, and the price index and inventory index further dropped, indicating a weakening U.S. economy. On the other hand, the supplier delivery index suggested fast deliveries, indicating minimal disruptions in the supply chain. This supported the price decline of several commodities, including Isoprene Rubber, due to the normalization of the supply chain.

However, there is recent positive news as the U.S. House of Representatives approved the suspension of the USD 31.4 trillion debt ceiling rate. This suspension holds potential benefits in terms of financial stability and confidence. Furthermore, oil prices are expected to rebound to a certain extent due to stable economic conditions. Consequently, researchers at ChemAnalyst anticipate a surge in Isoprene Rubber prices in June, driven by improving economic conditions and the strong market performance of the automotive industry.

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