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2008 Rubber Industrial Chain Review |
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∧-type SBR Price Trends 2008
SBR prices kept climbing through 2008 on higher crude oil and butadiene feedstock prices, strong downstream demand and rising natural rubber and BR prices. except that Lanzhou PC’s 100,000 tonnes/year SBR capacity was put into production in May-June. SBR prices hit a new high in the end of July. However, the US sub-prime mortgage crisis broke out and the global economy dented from the end of July. As automobile industry is closely tied to economic development, global automobile sales volumes may decrease for the first time in recent years and thus tyre industry will suffer from a setback. At that time, China, as a rising tyre production base, will falter significantly, so will local rubber including SBR markets.
For example, SBR prices in east China hit a new high in late July with non-oiled 1502 levels at CNY26,100/tonne and oiled 17112 at CNY22,800/tonne. In mid December, non-oil prices fell to CNY7,300/tonne and oiled prices to CNY6,200/tonne, losing 55-60% compared with the highest level of the year.
Natural Rubber Prices Nosedived
Natural rubber market saw ∧-type price trend following the global economy in 2008. Prices hit a new high in middle of the year and then nosedived on falling oil prices. In the first half of the year, natural rubber prices shot up due to strong demand for tyres, shoes and other rubber products from overseas markets and higher oil prices. However, the globally spreading financial crisis slashed local natural rubber prices to a 6-year low in the end of 2008.
Dye rubber: SHFE rubber continuous contracts fell from CNY28,495/tonne on 27 June to CNY8,650/tonne on 8 December, a decrease of nearly 70%. Tokyo Commodity Exchange rubber continuous contracts hit a new high of Yen354.5/kg on 30 June and fell to Yen 99.9/kg on 5 December, losing over 71%. RSSS3 offers dropped from $3,350/tonne in early July to $1,100/tonne in mid December, losing around 67%.
Latex: barreled latex import prices in east China dropped from CNY20,600/tonne in early July to CNY10,300/tonne in early December, a decrease of 50%. Offers for barreled latex shipments fell from $2,330/tonne in early July to $1,120/tonne in mid December, a decrease of 52%.
A large number of domestic tyre manufacturers, rubber product manufacturers and traders breached contracts on the continuous price falls and hence Chinese buyers were plunged into all-around credit crisis.
BR Prices Nosedived
BR market saw ∧-type price trend following the global economy in 2008. Prices hit a new high in middle of the year and then nosedived on falling oil prices. In the first half of the year, BR prices shot up due to strong demand for tyres, shoes and other rubber products from overseas markets and higher oil prices. However, the globally spreading financial crisis slashed local BR prices to a 6-year low in the end of 2008.
For example, BR prices rose continuously from CNY21,000/tonne in early 2008 to CNY26,500/tonne on 21 July. With the outbreak of the global financial crisis, BR prices plunged to a new low of CNY7,700/tonne on 17 December, losing around 70%.
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