Analyst: Critical times ahead for European butadiene supply

Frankfurt, Germany – European butadiene supply could come under acute pressure pressure over the next two years due to steam cracker closures and the impact of rising Asian demand on global trade flows.

That's according to Angie Joe, vice president, crude C4s and derivatives at Argus Media, who identified 2028 as a potentially critical year for the European butadiene market.

"In my opinion, 2028 will be a very pivotal year for western Europe," the Argus analyst set out at the WDK German rubber industry conference, held 3 Nov in Frankfurt. 

Upcoming cracker closures include Dow's facility in Boehlen, Germany, and TotalEnergies' steam cracker in Antwerp, Belgium – both scheduled to cease operations by the end of 2027.

Meanwhile, the start-up of Ineos' Project One cracker in Antwerp, currently targeted for the second half of 2027, will add new ethylene production capacity.

However, noted Joe, the Ineos facility will use ethane feedstock, which produces less crude C4 than conventional naphtha cracking: therefore offering limited additional butadiene supply.

Meanwhile, there is "more and more pressure" on other European crackers, following several years of production restructuring across the European synthetic rubber and petrochemical industries.

Moreover, continued Joe, China is expected to remain dependent on butadiene imports for the foreseeable future despite substantial investment in new petrochemical facilities there.

China imported more than 400 kilotonnes of butadiene in 2025, equivalent to the output of several production units, according to the presenter.

Indeed, added Joe, China is expected to remain structurally short of butadiene through 2035 or longer, despite continuing investment in domestic production.

Much of China's new petrochemical capacity was concentrated in the south, while major consuming industries were located further east, creating additional logistics requirements, she also noted.

Also, the analyst expects northeast Asian butadiene prices to remain above those in Europe and the US over the next 24 months, reflecting stronger derivative consumption and higher feedstock costs.

US market shift

In the US, meanwhile, the closure of several butadiene-consuming plants has significantly reduced domestic feedstock requirements.

Joe highlighted Invista's shutdown of adiponitrile production in Orange, Texas, alongside the suspension of Denka's chloroprene rubber operations in LaPlace, Louisiana.

Other developments include Lion Elastomers' decision to cease rubber production at its Orange, Texas, facility and the closure of Ineos Styrolution's ABS plant in Addyston, Ohio.

Together, these closures represented almost 20% of US butadiene consumption on a nominal capacity basis, said Joe, commenting: "It's a real shift in the US market."

With domestic derivative demand declining, US butadiene exports have been increasing: a trend expected to accelerate as new cracker capacity comes online.

The Americas region, forecast Joe, will increasingly supply overseas markets, including Asia, while producers in Japan and South Korea also face higher costs and restructuring pressures.

Overall, the Argus analyst expects further rationalisation across the global butadiene value chain as manufacturers respond to changing competitiveness, feedstock availability and regional demand.