Butadiene: Import Booms and Markets Diverge

By Yu Wei, China National Chemical Information Center

Butadiene is an important industrial chemical used as a monomer in the production of synthetic rubbers, thermoplastic elastomers and plastics. It has two isomers, 1,2-butadiene and 1,3-butadiene, but when the word butadiene is used in business and industry, it usually refers to 1,3-butadiene, because 1,2-butadiene is difficult to prepare and has no industrial significance. Butadiene can be produced through extraction from C4 hydrocarbons, dehydrogenation of n-butane or catalytic dehydrogenation of butylenes.
At the end of 2013, China was capable of making 3.472 million t/a butadiene, up 18.8% year-on-year. In that year, 2.55 million tons were actually produced, up 14.9% year-on-year; apparent consumption was 2.912 million tons, up 15.0% year-on-year; import volume, 371 kt, up 8.8% year-on-year; export volume, 8 kt, down 79.5% year-on-year.

Table 1   Import sources of butadiene, 2008 and 2013 (kt, %)

Country/region    2008    2013    Average annual growth rate of import volume from
　　　　　　　　　　　　　　　　2008 to 2013
    Import volume    Proportion    Import volume    Proportion    
South Korea          63    44.1    141       37.8       17.5
Netherland          15    10.5     49       13.2       26.7
Taiwan              40    28.0     35        9.4       -2.6
Thailand           0     0.0     26        7.0         -
Iran               0     0.0     21        5.7         -
Brazil               0     0.0     20        5.4         -
USA                   5     3.5     12        3.2       19.1
Others              20    13.9     67       18.3       27.4
Total            14.3   100.0    371      100.0       21.0



Domestic supply includes imports

In 2013, China imported 371 kt of butadiene, accounting for 12.7% of domestic apparent consumption. South Korea is China’s largest butadiene source with a total export volume of 141 kt, accounting for 38.0% of the total import volume to China. The import volumes from the Netherlands and Taiwan account for 13.2% and 9.5% of the domestic total, respectively.
Table 1 shows China’s major import sources for butadiene in 2008 and 2013. The import volume increased rapidly from 2008 to 2013 with an average annual growth of 21.0%, and it is forecast to continue to increase in the next few years, as the production capacity in China is insufficient and consumption is increasing. In the future, the proportions of import volume from the Netherlands, Thailand and Iran are expected to increase.

Imports of SBR and PBR climb while ABS resin import slumps

Major consumers of butadiene in China include the manufacturers of styrene-butadiene rubber (SBR), polybutadiene rubber (PBR), acrylonitrile-butadiene-styrene (ABS) resin, styrene butadiene styrene (SBS) elastomers and nitrile rubber. Figure 1 shows the high volume applications of butadiene in 2013.
(1) SBR and carboxylated SBR. In 2013, China imported 226 kt of SBR and carboxylated SBR (including plates, sheets and ribbons). The top three sources were South Korea, Russia and Japan, accounting 32.7%, 19.5% and 12.4% of the total volume, respectively. See Figure 2 for details. From 2008 to 2013, the volume of SBR and carboxylated SBR imported to China increased rapidly at an average annual rate of 26.5%. In particular, the average annual growth of import volume from South Korea was 41.6%. In the future, South Korea’s SBR industry can significantly affect the import and supply of SBR and carboxylated SBR to China.
(2) PBR. In 2013, China imported 156 kt of PBR (including plates, sheets and ribbons); major sources are shown in Figure 3. The top three are South Korea, Japan and USA, accounting for 50.6%, 11.5% and 9.0% of the total respectively. From 2008 to 2013, the annual import volume grew 14.0% on average; imports from South Korea grew fastest, averaging 29.1%; as a source Germany’s growth was negative, -3.6%, while Britain’s was almost zero.
(3) ABS resin. In 2013, China imported 1.511 million tons of ABS resin (in primary forms), and the three major import sources were Taiwan, South Korea and Malaysia, accounting for 54.1%, 33.1% and 4.3% of the total import volume to China, respectively. See Figure 4 for detail. From 2008 to 2013, due to continually increased capacity in China and a weak increase in domestic industrial demand, the import volume of ABS resin (in primary forms) declined 5.0% per year on average.

Prospects and suggestions

In a nutshell, some of China’s butadiene supply is still imported, and there is still potential for demand growth. In the next few years, the volume of imported butadiene will continue to grow. As for the downstream products, the volume of imported SBR will increase rapidly; that of PBR will increase steadily; that of ABS resin will continue to decrease. The import of these downstream products will rely both on the transformation of China’s economic structure and on fluctuation of the worldwide market. Domestic producers are encouraged to analyze changes in the market and the industrial chain; then they can adjust investment patterns and upgrade products accordingly.