The average price of Asian butadiene sank 18% month on month in April to $1,431.25/mt FOB Korea due to weak demand from China and an oversupply of synthetic rubber, Platts data showed Thursday.
The monthly average was down a sharp 58% from $3,092.50/mt in April 2012.
A buildup of synthetic rubber stocks in China due to poor demand from tire makers weighed on prices, as butadiene is a key feedstock in the production of synthetic rubber.
The weak demand has been reflected in recent data from several sources.
China imported 28,388 mt of butadiene in March, down from 31,208 mt in February, latest data from General Administration of Customs showed, while South Korea exported 7,523 mt of butadiene to China in March, down 57% from February, according to latest Korea Customs Service figures.
Synthetic rubber stocks held in warehouses in Qingdao, China, stood at 53,900 mt on April 25, up from 51,000 mt on March 29, latest Qingdao International Rubber Exchange data showed. The typical level in the region is a much lower 20,000 mt. Overall rubber stocks at Qingdao stood at 368,500 mt on April 25, up 3% from March 29.
The weak demand and glut in supply prompted Kumho Petrochemical to shut its 120,000 mt/year butadiene rubber and 60,000 mt/year solution styrene butadiene rubber plants on April 1. A restart date has yet to be confirmed.