With the downstream demand season still ahead, processing companies continue to maintain relatively low inventory levels as a safety measure. Despite the end of September, the price of butadiene rubber has increased by approximately 100 yuan per ton compared to the end of August, reaching between 15,600 and 15,900 yuan per ton. However, market participants remain uncertain about the direction of the butadiene rubber market. During the National Day holiday, businesses were hesitant to purchase goods, and the unexpected drop in supply has helped keep prices stable.
Looking ahead, the supply-demand balance for butadiene rubber is expected to improve further. October typically marks the traditional consumption period for butadiene rubber, and the natural rubber market, which has been affected by supply shortages due to natural disasters, is likely to have a significant impact on the butadiene rubber market, boosting consumer demand. Although Daqing is expected to operate at full capacity and Jinzhou is set to resume production, the news that Yuehua will shut down could increase domestic supply. Overall, the supply-demand relationship is expected to remain favorable.
Additionally, the price of raw butadiene has been gradually declining, which supports the production of butadiene rubber. As part of the Asian butadiene facilities begin maintenance and resume operations, along with an increase in ocean freight shipments, the supply of butadiene in Asia, including China, is expected to rise, easing the tight supply situation. The domestic butadiene market is showing a slight downward trend.
Natural rubber is also providing support to the market. Typhoon "Dawei" hit Hainan on August 26th, causing significant damage during the tapping season. In the reclamation area, rubber production suffered heavy losses, with 4.7 million trees discarded, 2.1 million broken, and 11.05 million partially collapsed. The main branches totaled 31.34 million, and the sudden drop in production is an undeniable fact. Natural rubber is expected to once again support market prices due to the supply shortage. Experts predict that "Dawei" may lead to historic breakthroughs in Hujiao, and with this linkage, the spot market is also expected to reach new heights.
Taking all these factors into account, if no major incidents occur, the butadiene rubber market is expected to experience limited volatility after the recent turbulence has stabilized.
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