Weak Demand Fundamentals Dampen India Polybutadiene rubber Market Sentiment
- 03-Feb-2022 1:22 PM
- Journalist: S. Jayavikraman
After having a firm Q4, Polybutadiene rubber (PBR) prices in Indian domestic market observe a dip in the initial assessments of Q1 2022. A marginal dip in the Polybutadiene rubber prices came on the back of weakening demand from downstream industries.
Polybutadiene rubber prices have declined by 1.7% during the last week of January since the conclusion of the last quarter. Earlier, Polybutadiene rubber market in India were assessed as firm throughout Q4 of 2021 owing to healthy demand fundamentals. PBR prices continually increased from October to December.
Tyre industry is the largest segment of consumption of Polybutadiene rubber worldwide, while footwear and sports accessories form the secondary segment of consumption. Stagnancy in automotive industry has globally hampered the tyre consumption. Demand from Original equipment (OE) has been sluggish owing to stagnant production levels, although demand from replacement tyre segment kept the consumption levels robust in 2021. However, in 2022 replacement tyre demand has also stabilized which deterred the market participants to show proactive procurements. This has spur conservative sentiment in the market. Global economy has been slowing down owing to adverse impacts of new Covid variant along with stagnancy in automotive industry and recent plunge in construction industry.
As per ChemAnalyst, “Polybutadiene rubber market in India is likely to remain on the bearish trend in coming weeks owing to sluggish offtakes from downstream tyre industry. Automotive sector is unlikely to improve production before H2 of 2022, therefore it is expected that demand of PBR from automotive industry is likely to remain sluggish. Hence, Polybutadiene prices are likely to maintain bearish trend in coming months given supply fundamentals remain stable in the domestic market.”