According to the monitoring of the business community, the domestic butadiene market continued to fluctuate and rise in December. From December 1 to 29, the domestic butadiene market price rose from 6407 yuan/ton to 6978 yuan/ton, with an increase of 8.91% during the cycle and a year-on-year increase of 50.96%.

At the beginning of the month, the domestic butadiene market continued to fall, while the European price of the external market fell sharply, which affected merchants’ concerns about the supply pressure of the global market. At the same time, the domestic northern spot resources were abundant, and the poor transaction dragged down the weak market. As the price of butadiene declines, the downstream will make up for bargains periodically. In the first ten days of this month, the 1 # unit of Yangzi Petrochemical Company was temporarily shut down due to the impact of upstream accidents. The sudden positive supply side boosted the mentality of the merchants. The quotation of butadiene products of various distribution companies of Sinopec, the main manufacturer, was raised by 300 yuan/ton, which helped the traders to keep up. In the middle of this month, after early consumption, traders had less goods in their hands, which coincided with the need for periodic replenishment in some downstream areas, once driving spot prices higher. In the last ten days of this month, affected by the low expected commencement of the cracking unit, the external price rose, which boosted the domestic spot market. At the same time, there was no sales of superior products in domestic new capacity, and the supply increase was less than expected, which jointly boosted the domestic spot market.

In terms of cost, on December 29, the benchmark price of WTI crude oil of the business community was $79.53 per barrel, down – 1.27% compared with December 1 ($80.55 per barrel). On December 29, the benchmark price of naphtha in the business community was 6811.50 yuan/ton, a decrease of – 9.21% compared with December 1 (7502.25 yuan/ton). Butadiene costs have many negative factors.

On the supply side, Sinopec East China Sales Company raised the listing price of butadiene by 200 yuan/ton, and implemented 7000 yuan/ton since December 21. Zhejiang Petrochemical 2 # 250000 t/a butadiene plant was restarted, but the plant operation rate was low, and the capacity utilization rate of butadiene industry increased by 3.53% month on month. Zhejiang Petrochemical Phase II 250000 t/a plant was shut down for maintenance on November 22, and restarted on December 19. Lianyungang Petrochemical 70000 t/a butadiene unit took off and landed on November 10 for negative operation. Fujian Lianhe 120000 t/a unit was shut down for maintenance on December 2 and restarted on December 22. Although some early maintenance devices were restarted, the operating rate was still relatively low, and there were some positive factors in the supply side.

On the demand side, according to the monitoring of the business community, the price of cis-1,4-polybutadiene rubber in China fell by a narrow margin. On December 29, the benchmark price of cis-1,4-polybutadiene rubber in the business community was 10580.00 yuan/ton, a decrease of – 3.73% compared with December 1 (10990.00 yuan/ton). The price of domestic styrene butadiene rubber fluctuated downward. On December 29, the benchmark price of styrene butadiene rubber in the business community was 10825.00 yuan/ton, a decrease of -0.31% compared with December 1 (10858.33 yuan/ton). The price of nitrile rubber in China fluctuated narrowly. On December 29, the benchmark price of nitrile rubber in the business community was 15025.00 yuan/ton, a decrease of -0.83% compared with December 1 (15150.00 yuan/ton). At present, the downstream rubber industry continues to be in strong demand and lacks sustainable support. Most of the product prices fall by a narrow margin, and the commencement of construction remains at about 60%. There is no obvious positive factor for butadiene demand.

In terms of external market: the closing price on December 28, the external price of butadiene in Asia rose: South Korea FOB reported 805-815 dollars/ton, up 10 dollars/ton; China CFR reported 835-845 dollars/ton, up 10 dollars/ton. The external price of butadiene in Europe remained stable: FOB Rotterdam closed at USD 505-515/ton; FD Northwest Europe closed at 695-705 euros/ton.

It is predicted that the prices of major manufacturers will be pushed up, and at the same time, the external market will be on the rise, and the domestic market will be hard to supplement with low-cost goods. At the same time, the downstream still maintains a just need to follow up, and the sustainability of demand side support is limited. Butadiene analysts from the business community predict that the domestic butadiene market may consolidate in the short term.