On the Shanghai Futures Exchange today, the natural rubber front-month settled at ¥19,600/t, up 2.51% on the day. Butadiene rubber (BR) closed at ¥15,680/t, up 5.73%—roughly twice the gain of NR. That pushed the NR–BR spread from about ¥3,400 at the start of the month to ¥3,920/t.

The spread directly reshapes compound economics. A typical passenger-car tire formula carries 30%–45% natural rubber, with BR and SBR making up the rest. When BR rises faster than NR, compounders lift the NR share toward its upper bound to hold down per-tire material cost.

Substitution is not free. NR and BR differ in Mooney viscosity and cure rate, so switching formulas means reworking filler loads and the vulcanization curve. Plants typically keep a 1–2 week validation window. The current spread has crossed the threshold most mills watch (roughly ¥3,500–4,000), so the next two weeks should see concentrated formula adjustments.

For SNSUC's rubber arbitrage and bonded-warehouse receipt business, a wider spread means hedge ratios across contracts must be recomputed. We suggest shortening BR hedge tenors from monthly to biweekly to avoid a fast synthetic-rubber rally eating the hedge surplus.