Butadiene is forecast to grow sluggishly

Butadiene growth will be sluggish this year, and pressure on selling prices that developed in May will continue. Despite substantial new ethylene capacity in place, output of butadiene likely will be flat to down a bit for the year, with a slight increase in imports adding to the total supply. Imports for the year will be nudged upward because of a large jump in imports during this quarter. Imports will decline, however, during the second half of the year because U.S. prices will be lower. Demand for butadiene also will increase only slightly, stemming from lower than normal growth in output of several synthetic rubbers and from low growth in nonelastomer uses. Two synthetic rubbers— styrene-butadiene rubber (SBR) and polybutadiene—account for more than half the butadiene use in the U.S. Both of these rubbers largely are consumed in making tires. U.S. tire production continues to be buffeted by improvements in tire life (which dampens growth ...