Published February 2016
The single largest use for butadiene is in the production of synthetic elastomers including styrene-butadiene rubber (SBR) and polybutadiene rubber, both of which are consumed in the manufacture of tires. Other elastomer applications include nitrile rubber hoses, mechanical belts, carpet backing, footwear, and neoprene products. Butadiene is also copolymerized into plastics, the largest-volume being acrylonitrile-butadiene-styrene (ABS) resins, which are used in various applications.
Because of the global nature of butadiene production and its diverse applications, it is impacted by various dynamics including changes in the production of ethylene, ﬂuctuations in energy markets, and general economic cycles.
The following pie chart shows world consumption of butadiene:
As of 2015, Asia (Northeast Asia and Southeast Asia) is the largest producing region in the world, accounting for nearly 52% of total production.
Elastomer production represents 60–65% of world butadiene demand, with a majority consumed in tires. Butadiene demand in tires depends on a variety of factors, including
- New vehicle production
- Tire design (e.g., tread wear, performance, operating conditions)
- Replacement tire demand/consumer spending
- The price of competitive elastomers, including natural rubber
Additional factors that have impacted tire markets in recent years include the use of renewable materials in tire manufacture and a focus on improved energy efficiency as a result of labeling laws enacted in Europe. Although not used in tires, both nitrile rubber and polychloroprene elastomers are used extensively in various other automobile applications.
ABS resin production is the largest nonrubber market, and the third-largest individual end use in 2015, accounting for nearly 12% of the total. Used in various home and office appliances, personal electronics, and automotive componentry, global demand will likely improve at a rate of 3–4% annually on end-use market growth.
In regions where downstream markets are still developing, such as the Middle East and Asia, demand growth will be robust. Continued economic and demand growth in China will secure it as the world’s largest producer and consumer of butadiene, while in the more mature markets of North America, Western Europe, and Japan, growth will be much slower or even decline over the forecast period. With the rapid development in China, Asia has emerged as the world’s most active butadiene market, with new capacity being built close to naphtha-fed steam crackers and downstream derivatives production expanding rapidly.
Analysts indicate that automobile sales in emerging markets are anticipated to double or possibly triple over the next 10 to 15 years, driven by an expanding middle and upper class. Given current economic conditions, however, companies will continue to exercise caution in planning and executing new capacity buildup, particularly with instability in both naphtha and butadiene pricing.
Global butadiene demand will grow at a rate of about 3% per year to 2020.