Market News

At 09:58 HKT, BR December 2026 traded at CNY 16,205/t, also the session low, breaking the re-escalation line of 16,538 set by the current downside alert. The domestic day session opened at 09:00 with the chemicals complex broadly weaker, rubber leading the decline while PP, EB and L also retreated.

Breach test: Against the 22:41 on 2 November alert price of 16,705 the contract is down a further 2.99%, clearing the 1% re-escalation bar; from 09:18 it closed 35 consecutive minutes below the effective threshold of 16,488, a breach depth of 2.01%, far beyond the 0.3%-for-three-minutes test. It is down 3.08% against the 16,720 night-session close, down 2.38% against the 16,600 opening print and down 5.12% against the 17,080 settlement of 2 November. All three bases point the same way and both the screen price and the minute series sit below the threshold, so a false breach is ruled out.

Drivers and supply: The move comes from a two-sided easing in physical fundamentals rather than from cost. Demand: semi-steel tyre utilisation is 64.54% (down 0.10pp week on week and 7.58pp year on year) and all-steel 59.06% (down 0.36pp and 6.28pp), with tyre makers buying only for immediate needs. Supply: Yanshan Petrochemical and Zhejiang Petrochemical have raised loads, Qixiang Tengda's upstream units are restarting with its BR line to follow, BR utilisation stands at 69.02% and total inventory at 37,900 tonnes (up 1.07%); Shandong Weite, Dushanzi and Yanshan's rare-earth BR lines remain shut, so the recovery is not across the board. Cost has moved the other way: butadiene delivered in central Shandong is quoted at CNY 15,150/t, up 9.98% on the week, leaving BR margins at minus CNY 747/t. Crude has recovered to near flat during the session while chemicals extended losses, so this leg is driven by rubber's own supply and demand.

Direction: Rubber is cut to downward from rangebound-to-weak, with supply on the loose side; crude, polyolefins and the styrene chain stay downward, with supply loose, tight and tight respectively. Over the next one to three sessions rubber is seen 50% down, 25% up and 25% sideways (model estimates, not a traded-market guarantee). The call flips if tyre utilisation rises for two straight weeks, or if butadiene clears 15,500 while BR stops following it lower.

Procurement: Spot has not followed and quotations are held: SunSirs puts BR at CNY 17,290/t, unchanged, so futures now sit about CNY 1,085 (6.3%) below spot and a futures fall must not be back-solved into a spot cut. Compare offers on the same grade (BR9000), tax basis, delivery and payment terms, and require committed volume plus a validity of three days or less. Tyre makers should cover November's immediate needs now rather than chase the fall; traders should avoid pricing cargoes off the screen. Release: BR back above 16,909.2 for two comparable observations. Re-escalation: 16,043.0 (effective 15,994.9 or below).

To be confirmed: PP January 2027 at 10,048 is down 1.17% against its alert price, past the 1% bar, but only one minute close at 09:55 dipped to 10,031, short of three consecutive minutes; EB, L and SC are down 1.09%, 0.90% and 0.29% against their alert prices and none clears the depth test, so no further re-escalation qualifies. The CNY 17,290 BR figure is a SunSirs market reference rather than a plant list price, and 3 November plant prices are still to be confirmed. Crude has been repriced against the official 2 November settlements (Brent 104.77, WTI 96.46). Five of the eight Eastmoney items were readable this round, with CL00Y, RU and BR continuous contracts missing, and a missing value is not zero.

SUNTA Market Intelligence Department