During this period, butadiene prices in the Asian market experienced minor fluctuations. Trading activity was limited this week as several Asian traders attended the China Guiyang International Olefins Annual Conference. Key takeaways from the conference discussions indicated that the supply-demand balance for butadiene in Asia is likely to remain tight through 2027, supported by delayed start-ups of new plants, the lightening of cracker feedstocks, capacity optimization in South Korea, and demand substitution from natural rubber.
Significant and unpredictable volatility in upstream raw materials has increased the difficulty of negotiating long-term contracts (LTCs) for 2027. Suppliers are expected to reduce allocated volumes under LTCs, shifting more transactions to the spot market; meanwhile, freight costs are rising. Southeast Asian traders reported weak demand, with buyers showing resistance to premiums over LTC prices. Downstream demand for cis-polybutadiene rubber (BR) remains poor, with customers largely adopting a wait-and-see approach. Due to adverse economic conditions, tire manufacturers are unable to operate at full capacity. In South Korea, downstream butadiene consumers are reluctant to purchase above USD 1,600 per tonne and have chosen to reduce operating rates.
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