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  • Developing Fortunes of the C4 Value Chain
  • Date:2012-11-25
  • A severe tightness in global butadiene markets has drawn considerable attention to the C4  value chain  and its prospects for future development.  Structural changes in global   olefin  feedstock selection, supply additions and plant production utilization have resulted in both shortages and unpredictability in mixed C4 supply.  In  addition, record  highs in natural rubber  prices have supported higher demand for synthetic rubbers as well as butadiene in 2011.   With a tightening mixed  C4 feedstock  supply  and  consistent  derivative demand,  the  price  of  butadiene has increased dramatically culminating in record highs in 2011.                      
    Furthermore, pricing has becoming extremely  volatile  with   large  fluctuations in price  spreads  occurring over relatively  short time frames. The current and evolving landscape remains highly unpredictable due to the complex nature of the C4  value chain.  A key issue facing the industry today is tied to availability and production of mixed C4 from  steam crackers.  The global landscape for olefins production is in a state of transition, characterised by changing in feedstock slates in different regions. Co-production of mixed C4, and available butadiene, is becoming increasingly difficult to forecast, and ultimately contributing to erratic pricing levels.