SBR Market Revives in Europe Amidst Inclining Demand From the Automotive Sector

Germany: Styrene Butadiene Rubber (SBR) market prices incline in the fourth month of 2023 on account of the rise in demand from end-use (automotive and synthetic rubber) units. Major components impacting the overall market prices of SBR include Styrene and Butadiene (feedstock). Crude oil availability kept fluctuating towards the quarter end in the European market since the geopolitical conflict between Russia and European countries. SBR prices in mid-April of 2023 were observed at USD 2100 per MT, FD Wuppertal in the German market.

As the availability of essential components, such as semiconductors, keeps improving, auto sales in Europe have increased the most since May 2021. According to the European Automobile Manufacturers' Association, new-car registrations increased by more than 25% in March 2023, continuing the positive momentum in sales of automotive industries, consequently raising the demand for SBR in the regional market. The rallies of strike occurring in the European market is not hidden from the eyes of the world as it has impacted the supply chain and productivity rate of the SBR in domestic and overseas market. Widened demand-supply gap has resulted in higher prices as it resulted in limited availability of the SBR in Europe.

European Union member states have reduced their energy imports from Russia, and the alliance placed restrictions on the country's oil and coal exports providing a major opportunity for the US market to become a major exporter of crude oil to Europe. While part shortages are subsiding, automakers must now struggle with rising inflation and declining economies, both of which are likely to weigh on sales as the automotive sector makes the difficult transition to electric vehicles from the petroleum-based sector. As per ChemAnalyst, SBR prices in the European market are expected to incline at a stagnant pace on account of a better demand outlook from electric vehicles and rubber industries.