PBR producers across Asia contemplating price hike.
In view of the recent price gains in the Feedstock Butadiene (BD) market, the producers of Polybutadiene Rubber (PBR) across Asia are weighing up the possibilities of raising their offers for the fresh spot shipments. PBR producers in the industry feel that the PBR producers might not be able to sell the high-sis stock at a price of anywhere below USD 1,150/tonne on CFR basis in line with the rising cost of feedstock BD.
Where the prices of the feedstock BD have registered a jump of 6% taking the price to an average of USD 825/ tonne the prices of PBR have been stable at an average of USD 1,050 to 1,090/ tonne (Figures coming from ICIS in first week of February 2016). According to some of the PBR users, they have had to adjust their offers owing to the higher production costs that resulted from rising costs of feedstock BD. On the other hand a nearly unlimited supply coupled with a weak demand has capped any price increase for the PBR. Extended shutdowns of downstream tyre factories in China during the week-long Lunar New Year holiday is also being seen as one of the reasons for limited demand for PBR.
A number of downstream tyre factories in China had shut their plants ahead of the holiday, with some not expected to resume production until late February, on account of poor demand amid a slowing Chinese economy.