Hydrogenated Nitrile Butadiene Rubber price surge in US amid positive demands and strong supplier’s action

The price of Hydrogenated Nitrile Butadiene Rubber (HNBR) remained steady this month in the US market. This stability is largely due to active market participation, with many buyers engaging in bulk accumulation of HNBR inventories. This accumulation has helped maintain stability in prices as demand and supply remain relatively balanced. Across various sectors such as automotive, aerospace, and other industrial segments, there is a strong demand for HNBR, which is driving its consumption in regional markets.

In the US market, the price of HNBR remained steady this month, holding at 35810 USD/MT FOB-Texas. However, there were notable price surges in the feedstock market, particularly in Acrylonitrile and Butadiene. Despite this, the downstream Automobile sector saw robust performance in March, with sales reaching 1455030 units, marking a 15.5% increase on a month-on-month basis and a 5.08% increase year-on-year. Although there was a slight decline in Manufacturing PMI figures, they stayed above the critical threshold. Manufacturing production in the US expanded further in March, reaching a 22-month high, indicating overall economic improvement and heightened market demand.

Conversely, the Aerospace market faced challenges as Boeing's 737 MAX jetliner production sharply decreased in recent weeks. This decline was attributed to increased factory checks by US regulators and a slowdown in assembly line work outside Seattle to address outstanding issues. Following a 737 MAX incident in January caused by an assembly error, the Federal Aviation Administration (FAA) imposed a production cap of 38 jets a month. However, the monthly output rate fluctuated well below this level, dropping as low as single digits by late March.

The ongoing severe drought affecting the Panama Canal, a crucial global trade route, has led to restrictions on daily crossings, raising concerns about potential disruptions to worldwide supply chains, particularly amid heightened demand for HNBR across various trading partners. Despite a recent increase in daily crossings to 27 from 24, supported by rising water levels at Gatun Lake, capacity constraints are beginning to impact supply chains. However, there is optimism that if anticipated rains return in May, the Panama Canal Authority intends to boost daily slots to around 36 per day, aligning with the average during the rainy season. Moreover, in the Mexican market, automobile sales surged by 9.83%, Brazil witnessed a 6.50% increase, and Canada experienced a notable 23.23% rise. These combined factors have significantly influenced the demand for HNBR in the US market.

According to ChemAnalyst's projections, the price of HNBR is anticipated to exhibit bullish momentum in the US market. This expectation of an increase in HNBR price aligns with growing demand from downstream sectors as well as increased demand from other importing nations. Market participants in the HNBR sector are actively involved in bulk accumulation, and the stability observed in prices this month reflects a balanced demand-supply ratio, which is anticipated to further rise with continued inventory accumulation. These factors collectively contribute to shaping the pricing dynamics of HNBR in the US market.