The Slowdown in the USA Economy Causing Polybutadiene Rubber (PBR) Prices to Surge

Texas, USA: The market value of Polybutadiene Rubber (PBR) has been consistently rising in the USA for the last several weeks. During the week concluding on 17th February, a surge of 2.7% was witnessed in the PBR price. Contracting supply side and increasing downstream demand are two major factors soaring PBR's value every week. The USA has already touched heights in terms of inflation with its increased monetary stimulus and supply chain issues and is now approaching a mild recession. Hence, a slowdown in USA's economy is currently being observed.

The manufacturing sector of the US economy is starting to show signs of slowing down along with the decline in the number of new productions and orders. So, the supply rate is limited and is sufficient as compared to the overall demand. Furthermore, the price of feedstock Butadiene rose by 1.1% during the considered week, surging the upstream cost involved in PBR and raising its production cost.

Contrary to the supply side, the demand sentiments of PBR have been flourishing in the USA market. As the sales of light vehicles are incrementing in the country, the downstream automotive industry has been doing well in the market. Though there are tighter credit conditions, disrupted consumer incomes, high prices, and limited inventories, the automotive industry has been doing well because of the already pent-up demand. Consequently, amidst tighter economic conditions, PBR supply is limited compared to its downstream demand in the market, which has been raising its market value in the country.

As per ChemAnalyst's anticipations, "The PBR prices would keep increasing in the USA market in the upcoming weeks owing to the rising downstream demand and increasing upstream cost as the market value of feedstock Butadiene is expected to surge even further. Additionally, the contraction in product manufacturing because of economic slowdown will likely stay in the market longer."