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Petroleum and Petrochemicals Economics Program: Petrochemical Market Dynamics

Petroleum and Petrochemicals Economics Program: Petrochemical Market Dynamics

Petroleum and Petrochemicals Economics Program: Petrochemical Market Dynamics

Butadiene Derivatives 2012

Butadiene Derivatives 2012 is one in a series of reports published annually as part of the and Petrochemical Economics program. This report provides an in-depth analysis and forecast of key petrochemical products including butadiene, butadiene rubber, butadiene rubber, butadiene styrene and other butadiene derivatives.

Published: April 2012

www.chemsystems.com Abstract

Global butadiene demand increased by more than In 2011, China produced 18.4 million vehicles, 1.7 million tons over 2010-2011, as the rubber and following growth rates of 48% in 2009 and 32% in recovered following the global 2010; growth in 2011 was a modest 1 percent economic crisis. Butadiene consumption is driven to following restriction by financial and local regulatory a large extent by the , which measures. Growth in vehicle production is now tends to exhibit a volatile growth pattern. higher than experienced in recent years due to the Consumption of butadiene reached 10.5 million tons emerging economies significantly outpacing the in 2011, following growth of 4 percent in 2011 and mature markets. double digit growth in 2010. Other industries influencing butadiene growth are electronics and In addition to the recovery in butadiene demand, consumer markets. butadiene price escalation and price volatility is a major on-going challenge. For many years butadiene Butadiene rubber (BR) was the largest end-use for was sold at a price between 1.5 to 2.5 times the butadiene in 2011, accounting for nearly 30 percent price. However, since 2008, the butadiene of demand, followed by styrene butadiene rubber to naphtha price ratio has frequently exceeded 3.0 on (SBR) and acrylonitrile butadiene styrene (ABS). the high-end and, during the recession, butadiene Styrene butadiene latex and hexamethylene diamine was traded below 1.25 times the naphtha price. (HMDA) and a number of other derivatives account for the remaining 35 percent of demand. On the supply side, the shortage of available mixed C4 remains a serious and continuing constraint for Approximately two-thirds of BR is consumed in tyre butadiene supply. Until the price run-up in 2008, production, with a further quarter used as an impact chronic oversupply of butadiene and mixed C4 modifier in high impact (HIPS) resulted in limited investment in butadiene extraction. production. Similarly, the majority of SBR is consumed in tyres, where it is used in the manufacture of tread. ABS is exposed to a broader Global Butadiene Consumption, 2011 range of end use industries with electronics/electrical appliance, household goods, and automotive sectors accounting for around three quarters of global Butadiene consumption, with the balance used in construction Others 19% Rubber and consumer products such as luggage shells, sport 28% goods and toys.

As expected, in recent years most of the growth HMDA recorded in the butadiene and derivatives market has 4% been in . Asia now accounts for more than half ABS of both butadiene production and consumption, 12% mirroring the change in location of vehicle production. Asia now also accounts for nearly half of global vehicle production following a step-change increase from around 30 percent market share in 2000. SB Latex SB Rubber 12% 25% In 2009, China became the largest automotive and commercial vehicle producer in the world with production reaching 13.8 million vehicles, ahead of both Japan and the . Table Of Contents

1. Executive Summary 4. Styrene Butadiene Rubber (SBR) 2. The Butadiene Derivatives Industry 5. Butadiene Rubber 3. Butadiene 6. Acrylonitrile Butadiene Styrene (ABS) 3.1. Global 7. Other Butadiene Derivatives 3.1.1 Consumption . Including styrene butadiene latex and hexamethylene diamine (HMDA) 3.1.2 Supply 3.1.3 Supply, Demand and Trade 3.2. North America Note: Sections 4 to 7 follow the outline presented for Chapter 3: Butadiene 3.2.1 Consumption

3.2.2 Supply 3.2.3 Supply, Demand and Trade Appendix A. Methodology 3.3. South America 3.3.1 Consumption B. The Butadiene Derivatives Industry – Technology 3.3.2 Supply

3.3.3 Supply, Demand and Trade

3.4. Western Europe 3.4.1 Consumption 3.4.2 Supply 3.4.3 Supply, Demand and Trade 3.5. Central and Eastern Europe 3.5.1 Consumption 3.5.2 Supply 3.5.3 Supply, Demand and Trade 3.6. and Africa 3.6.1 Consumption 3.6.2 Supply 3.6.3 Supply, Demand and Trade 3.7. Asia Pacific 3.7.1 Consumption 3.7.2 Supply 3.7.3 Supply, Demand and Trade Contact Us:

Anna Ibbotson Petroleum & Petrochemical Economics Manager Tel: +44 (0)20 7950 1528 Fax: +44 (0)20 7950 1550 E-mail: [email protected]

Heidi Junker Coleman Global Programs Support Manager Tel: +1 914 609 0381 Fax: +1 914 609 0399 E-mail: [email protected]

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