According to the Commodity Market Analysis System of Shengyi Society, from February 17th to February 24th, the domestic butadiene market price decreased from 12375 yuan/ton to 11587.5 yuan/ton, with a price reduction of 6.36% during the period. This week, the butadiene market experienced a wide decline, with increased expectations for equipment restart and supply. The synthetic rubber futures market weakened, and downstream demand was weak, among other negative factors. As a result, the market was under pressure and fell, with holders lowering their quotes and downstream demand not keeping up. As of February 24th, the mainstream delivery price of butadiene in Shandong region is between 11050-11300 yuan/ton, and the self pickup price from the tank in East China region is between 10800-10900 yuan/ton.

Cost aspect: During this cycle, crude oil prices first rose and then fell. As of February 21st, the settlement price of the main contract for WTI crude oil futures in the United States was $70.40 per barrel. The settlement price of the main Brent crude oil futures contract is $74.43 per barrel. The geopolitical risks in the Middle East have decreased, and the premium of oil prices has fallen; In addition, the increase in US crude oil inventories has affected investor confidence. During this cycle, crude oil prices have fluctuated at a low level. On the one hand, the US has imposed tariffs and Trump has requested OPEC to increase production to lower oil prices. In addition, US crude oil inventories remain high, and there are still concerns in the market about crude oil demand, which has suppressed crude oil prices; On the other hand, the geopolitical situation between Russia and Ukraine has eased, and crude oil market prices remain low.

Supply side: Sinopec’s various sales companies have lowered the listed price of butadiene by 700 yuan/ton and implemented 11700 yuan/ton.

Demand side: Recently (2.11-2.24), the market for butadiene rubber has been weak and slightly declining. According to the commodity market analysis system of Shengyi Society, as of February 24th, the market price of butadiene rubber in East China was 14300 yuan/ton, a decrease of 3.57% from 14830 yuan/ton on the 11th. The price of raw material butadiene has significantly decreased, and the cost center of butadiene rubber has dropped significantly; The production of butadiene rubber remains low, and the pressure on the supply side is relatively small; After the holiday, downstream construction gradually increased, mainly supporting the demand for butadiene rubber. Recently, the supply prices of Shunding rubber suppliers have been gradually lowered, and the quotes from merchants have been weak and declining. As of February 24th, the mainstream quotes for Shunding in Qilu, Daqing, Sichuan, and Yangtze in East China were 14200-14550 yuan/ton

Market forecast: In terms of the future, the crude oil market trend has been weak recently, with insufficient guidance for the market and weak cost performance. The overall supply has been relatively loose recently, and expectations are weak. In the near future, the demand side will maintain on-demand procurement with a preference for rigid demand. Overall, the market performance is bearish, and it is expected that the market trend will remain weak in the short term.