Polychloroprene

Market Dynamics Intelligence for Butadiene Rubber (July 29, 2026)

**I. Price Trends**
1. **Spot Market**
- As of July 29, the mainstream quotation for butadiene rubber in the East China region ranged from 12,000 to 12,350 yuan/ton, representing a 3.30% increase from the beginning of the month. The lowest point during the period was 8,600 yuan/ton.
- On July 27, the domestic spot market for butadiene saw improved trading sentiment. The baseline export prices for Dongming Petrochemical and Satellite Chemical were both set at 10,500 yuan/ton. Market prices were supported by rising international crude oil prices and active purchasing by traders, maintaining high-level volatility in the short term.

2. **Futures Market**
- On July 28, the closing price of the main butadiene rubber contract (BR) was 12,860 yuan/ton, a decrease of 3.78% from the previous day. The open interest stood at 65,700 lots, with a trading volume of 167,500 lots.
- On July 27, the closing price of the secondary main contract (BRS) was 12,725 yuan/ton, down 1.59%, with an open interest of 32,400 lots, indicating intensified short-term bullish-bearish competition.

**II. Cost Drivers**
1. **Raw Material Butadiene Prices**
- As of July 29, the price of butadiene was 9,466 yuan/ton, up 5.19% from the beginning of the month. The upward shift in the cost baseline provided strong support for polybutadiene rubber.
- On July 27, the butadiene spot market was active, with some enterprises raising their baseline export prices to 10,500 yuan/ton. Coupled with rising international crude oil prices, the cost-side support remained robust in the short term.

2. **Supply and Demand Dynamics**
- **Supply Side**: The domestic operating rate for polybutadiene rubber was approximately 67% at the end of July. Some facilities are scheduled for maintenance in August (e.g., Qilu Petrochemical’s 70,000-ton/year unit), which may alleviate supply pressure.
- **Demand Side**: The operating rates of the downstream tire industry increased slightly. The operating rate for semi-steel tires rose from 70% at the beginning of the month to 75%, while that for all-steel tires increased from 62% to 65%, providing rigid demand support for polybutadiene rubber.

**III. Market Driving Factors Analysis**
1. **Cost Push**
- Butadiene prices rose by over 5% cumulatively in July, driven by higher crude oil prices and tight spot availability, directly pushing up the production costs of polybutadiene rubber and forcing enterprises to follow suit with price increases.

2. **Supply Volatility**
- Maintenance plans for some facilities in August (such as Qilu Petrochemical and Shandong Yihua) will reduce market supply, alleviating previous oversupply pressures.

3. **Demand Resilience**
- The operating rates in the tire industry rebounded, particularly with growth in export orders for semi-steel tires, providing stable support for the demand of polybutadiene rubber.

4. **Macro and Policy Factors**
- The national \"Stable Growth Work Plan for the Petrochemical and Chemical Industry (2025-2026)\" encourages the R&D of high-end synthetic rubber, which is beneficial for long-term industry structural upgrades, though its short-term impact is limited.

**IV. Risks and Challenges**
1. **Raw Material Price Volatility**
- Butadiene prices are influenced by international crude oil and the operating rates of cracking units. If crude oil prices fall or cracking units increase production, cost support may weaken.

2. **Seasonal Demand Downturn**
- After August, the tire industry enters a traditional off-season, where demand growth may slow down, exerting downward pressure on prices.

3. **Import Competition**
- As overseas butadiene units gradually resume operation, China’s import volume may increase, squeezing profit margins in the domestic market.

**V. Future Forecast (August 2026)**
1. **Price Trends**
- **Short-term (1-2 weeks)**: Supported by costs and expectations of supply maintenance, polybutadiene rubber prices may oscillate and rise, with a target range of 12,500 to 13,000 yuan/ton.
- **Medium-term (1-2 months)**: If tire demand does not improve significantly, prices may come under pressure due to the resumption of supply. Attention should be paid to butadiene prices and the progress of facility maintenance.

2. **Key Variables**
- **Butadiene Prices**: If international crude oil continues to rise or cracking units experience unexpected shutdowns, cost support may strengthen.
- **Tire Operating Rates**: Semi-steel tire export orders and the replacement market demand for all-steel tires are key demand indicators.
- **Policy Impact**: Environmental restrictions or adjustments to import/export tariffs may cause short-term volatility.

**VI. Operational Recommendations**
1. **Upstream Enterprises**: Appropriately increase operating rates to leverage cost advantages and expand market share.
2. **Downstream Enterprises**: Recommend purchasing according to actual needs to avoid hoarding at high prices, and monitor the impact of August facility maintenance plans on supply.
3. **Traders**: In the short term, consider restocking at lower levels, but remain vigilant against the risk of price corrections due to the demand off-season.