Polybutadiene Rubber Prices Decline Amid Falling Natural Gas and Butadiene Costs

Hamburg, Germany: The prices of Polybutadiene Rubber (PBR) have been declining in the European market since the last week. ChemAnalyst researchers suggest that falling natural gas and Butadiene prices are the two primary reasons behind this price drop in the PBR market. During the week ending on 25^th November, the price of PBR assembled at USD 2500/MT FOB Hamburg indicated a fall of 1% on a weekly basis. The current week has been experiencing the same downward trend in the PBR market. Furthermore, the prices of every other Synthetic Rubber have been dropping since the last week.

The market value of feedstock Butadiene decreased in the European market as the demand for the same subdued owing to recession fears in the upcoming weeks. For the week concluding on 25^th November, the assessed price of Butadiene was USD 1015/MT FD Hamburg, which showcased a significant drop of 5.3% within a week. Moreover, as European natural gas reservoirs have been filled up by more than 70%, the ample availability of natural gas has stabilized the market and resulted in its price reduction. With the balanced natural gas market, Europe has rescued itself from a major energy crisis; hence the prices of several elastomers have been observed to be decreasing.

Additionally, as the automotive and tire industry has not been experiencing much demand, the offtake of PBR from these industries has been decrementing, which is another crucial factor behind the price drop of PBR in the European market. Altogether, falling Butadiene prices, stabilizing energy conditions, and weak downstream demand from tire and automotive are all responsible for dropping PBR prices.

As per ChemAnalyst anticipations, “The PBR prices are likely to keep declining in the upcoming weeks because of decreasing Butadiene and Natural gas prices. Furthermore, as December is the month for destocking of already available inventories, manufacturers would not mind selling their products at a cheaper cost to clear off their storages.”