Thread Content
On April 25, Rongsheng Petrochemical announced that the plant built by its holding subsidiary Zhejiang Petrochemical Co., Ltd. (hereinafter referred to as “Zhejiang Petrochemical”) in the Zhoushan Green Petrochemical Base – a facility with an annual production capacity of 100,000 tons of styrene-butadiene rare earth rubber and 70,000 tons of nickel-based styrene-butadiene rubber – has successfully started operations recently, and qualified products are now being produced. The impact of Zhejiang Petrochemical’s styrene-butadiene rubber production facility on the market and prices: With the commissioning of Zhejiang Petrochemical’s 100,000-ton/year styrene-butadiene rubber facility, the production capacity of this material in the East China region increased to 542,000 tons. This facility is connected to upstream butadiene production units, and it is located in the East China region, which is one of the main markets for styrene-butadiene rubber; this reduces costs in terms of production and transportation. As this facility is new to operation, it lacks the support of major customers and long-term order contracts in the initial stage; therefore, price discounts and spot sales constitute its normal trading pattern. Inevitably, this leads to direct competition with other butadiene rubber suppliers in the region – price discounts will drive down transaction prices in that area, while spot sales will replace those from other suppliers in terms of market volume. Supported by stable production and the promotion of long-term contracts, the price discounts on styrene-butadiene rubber in the later period will decrease. However, the market share it occupies will inevitably reduce the supply volume from other sources; as a result, some of this supply will flow into other trading markets. Overall, the commissioning of Zhejiang Petrochemical’s styrene-butadiene rubber plant will inevitably lead to an increase in the supply of styrene-butadiene rubber, and its consistent presence in the market over time will result in an overflow of supply. The market price of styrene-butadiene rubber dropped due to initial competition, before returning to a reasonable price level corresponding to its brand value. Prospects for the commissioning of Zhejiang Petrochemical’s styrene-butadiene rubber production facility: The widespread use of rare-earth-enhanced styrene-butadiene rubber is one of the directions for the future development of this industry. Moreover, this type of styrene-butadiene rubber is one of the key materials used in the production of \"environmentally friendly tires\". Zhejiang Petrochemical’s 100,000-ton/year styrene-butadiene rubber production facility is capable of manufacturing various grades of rare-earth-enhanced styrene-butadiene rubber. Thanks to the strong brand promotion efforts of Zhejiang Petrochemical, the company is set to become the most important supplier of such rubber in the industry within 10 years.