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May 21, 2013 02:00 AM

Analysts believe SBR demand to be slow, steady

European Rubber Journal Report
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    LONDON—Styrene butadiene rubber producers have reason to hope European car sales have hit the bottom, but they should expect any subsequent recovery in tire sales to be a drawn-out process, investment bank Wood & Company said.

    Wood's analysts looked at what April 2013 passenger car registration data from the European Automobile Manufacturers' Association, showing registrations up 1.7 percent year on year, the first increase since September 2011, could mean for a recovery in European SBR demand. The report was published in ICIS.

    European car sales remained depressed but "should the year on year improvement develop into a sustained trend over the following months, we would expect tire demand to follow suit," Wood's chemical industry analyst Piotr Drozd told the industry website.

    "This, in turn, could imply the onset of the long-awaited rebound in European SBR demand. But given the current macro environment, we expect that the potential recovery is likely to be a gradual and lengthy process," he said.

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