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In the first half of 2024, affected by factors such as high costs, relatively tight supply, and demand support, the rubber market will pick up and rise in prices, of which natural rubber, butadiene rubber, and styrene-butadiene rubber will increase by 11.33%, 23.49%, and 23.74% respectively. In mid-to-late June, on the one hand, the supply of natural rubber raw materials increased slightly, on the other hand, international crude oil prices fluctuated, the raw material butadiene was sorted out at a high level, and the styrene level fell at a high level, and the prices of natural rubber and synthetic rubber fell slightly under the comprehensive influence.
Figure 1: Natural rubber price movements
Figure 2: Butadiene rubber price trend
Figure 3: Styrene-butadiene rubber price trend
In terms of cost: In the first half of 2024, the price of rubber raw materials will rise sharply. As of June 29, the price of glue in Thailand was 70.45 baht/kg, up 27.40% from 55.30 baht/kg at the beginning of the year; The purchase price of state-owned, golden rubber water-based concentrated latex raw materials in Hainan production area was around 14,500 yuan/ton, up 15.08% from 12,600 yuan/ton at the beginning of the year.
As of June 30, the domestic butadiene price was 13,700 yuan/ton, an increase of 59.77% from the price of 8,575 yuan/ton at the beginning of the year; The price of styrene was 9416 yuan/ton, an increase of 10.01% from the price of 8560 yuan/ton at the beginning of the year.
In the first half of the year, the natural rubber producing areas were affected by factors such as the cut-off period and the weather, and continued to be in a state of low output, resulting in a tight supply of natural rubber raw materials and a sharp rise in the overall price, which supported the price of natural rubber; Synthetic rubber raw materials butadiene and styrene were affected by the sharp rise in international crude oil and the maintenance of some devices, and the prices rose sharply.
Supply: In the first half of the year, the rubber market as a whole was in a tight supply, which supported the rubber market. At the beginning of the year, Thailand entered the cut-off period one after another; Vietnam's production areas have entered the cutting period one after another, basically stopping cutting for 7-8 percent; The domestic Hainan production area and Yunnan production area have also entered a comprehensive suspension period, the later period affected by drought and rainfall, the output of natural rubber raw materials at home and abroad have increased slowly, resulting in the domestic natural rubber market supply pressure is relatively eased, Qingdao Port natural rubber inventory continues to slowly go to the warehouse, the formation of a strong support for natural rubber.
In addition, in the first half of the year, the start of butadiene rubber fluctuated greatly, but the overall level was at a low level. According to statistics, at the beginning of 2024, butadiene rubber started at around 5.2 percent, and after the Spring Festival, it increased to the highest point of half a year near 7.2 percent, and then declined again with the successive maintenance of multiple devices, and fell to the lowest point of around 4.5 percent in late May, and the start of construction in June increased slightly to around 5.8 percent.
Styrene-butadiene rubber started at the beginning of the year to early May as a whole to maintain between 6.2 ~ 7 percent, from mid to late May, a number of sets of styrene-butadiene rubber plants have been reduced one after another, and the start of construction once fell to around 5.3 percent, and as of the end of June, it rose to around 5.8 percent. On the whole, in the first half of the year, the supply of both natural rubber and synthetic rubber declined to a certain extent.
On the demand side: during the Spring Festival, the downstream tire start was as low as about 2 percent, and the demand for rubber fell to the freezing point. After the Spring Festival, the downstream tire start gradually increased, the tire enterprises in Shandong all-steel tire start to increase to around 7 percent, the later fluctuation between 5.2 ~ 7.1 percent, the domestic tire enterprises semi-steel tire start load has been maintained around 7.8 ~ 8 percent since March. Demand in the face of the rubber market just needs support.
Forecast for the future: In the second half of the year, the rubber market or the high level will fall back to the range
Raw material butadiene equipment maintenance and resumption of production in the second half of the year, coupled with the arrival of about 30,000 tons of cargo in Asia in the third quarter, and the third and fourth quarters of the new production capacity plan, it is expected that the raw material butadiene market in the second half of the year is not optimistic, synthetic rubber cost center of gravity or a certain degree of downward movement.
In the second half of the year, with the arrival of the peak period of rubber tapping in domestic and foreign production areas, the supply of natural rubber in China has increased, and there is still a certain amount of port inventory, and it is expected that the pressure on the supply side of natural rubber will increase in the second half of the year. The current inventory of synthetic rubber remains low, the supply side in the second half of the year focuses on the start of the device, the first half of the synthetic rubber plant maintenance, burden reduction more, if the gradual resumption of production in the second half of the year, the supply side of synthetic rubber will increase significantly.
The downstream tire start has been raised to a relatively high level, and it is difficult to have a significant increase in the second half of the year, and the rubber needs to maintain rigid support, and the support is not as strong as in the first half of the year.
To sum up, in the second half of 2024, the domestic rubber market will be mainly sorted out after the high level of the domestic rubber market has fallen.