India’s production to exceed overall output of rubber body nations

India’s production to exceed overall output of rubber body nations
July 30, 2011





Thiruvananthapuram: During a tough season of domestic rubber shortage, India has found some consolation. The country’s natural rubber (NR) production growth in 2011 is poised to soar higher than the overall rubber output growth of ANRPC (Association of Natural Rubber Producing Countries). In absolute production volumes, however, India remains fourth among the nine top rubber producers.

The growth rate of rubber production in (January-December) 2011 in all ANRPC members is expected to be only 4.9%, according to the number-crunching by ANRPC countries. In the corresponding period, India’s rubber production is anticipated to perk up by 5.7%.

“Climatic conditions have been partial to Indian rubber plantations this season, while other rubber-producing countries like Malaysia and Thailand were affected by adverse situations like flood. Besides, India’s NR productivity has retained its lead among peer rubber farmers,” Sheela Thomas, chairman of Singapore-based International Rubber Study Group (IRSG), said, when contacted by FE.

Rubber producing region in Central Kerala did not go through too much rain or too much dry climate in the first half of 2011. Shortage of skilled labour was a grave issue, she admitted. “But even labour shortage is manageable, provided there are higher wages,” said Thomas, also chairman, Rubber Board.

By and large, Indian rubber has stayed disease-resistant. “Supply from Vietnam during the third quarter of 2011 is expected to fall 9.4% on year due to severe oidium leaf disease in its upcoming rubber regions,” says Tom Jose, Senior Economist, ANPRC. Among individual countries, only Phillipines, Cambodia and Indonesia are estimated to post a higher rubber production growth than India in 2011. In the second quarter of 2011, China even shows a growth rate of minus 13.9% in NR output.

According to all estimates, total supply from all ANRPC members during this year is anticipated at 9.959 million tonne. “This is 4% higher than that of previous year,” says Kamarul Baharain Bin Basir, secretary general, ANRPC in the latest statistical bulletin (July 2011) of the Kuala Lumpur-based rubber producers’ outfit.

At the same time, ANRPC warns that globally the NR supply situation may stay tight till 2018. While giving its detailed statistical forecasts on global NR supply from 2012 to 2018, the report argues that supply is unlikely to grow beyond 3-4% during 2012. The shortage would be more acute after 2016, it says.







Synthetic rubber demand bounces back
July 30, 2011





Boosted by a resurgent automotive sector, the synthetic rubber market will soon be awash with product as new capacities come on stream

Escalating costs and the short supply of key raw materials have signaled troubled times for synthetic rubber markets over the past year. Nevertheless, with the important automotive end-use sector on the road to recovery and the megatrend of mobility gaining impetus, demand for tires – a core outlet for synthetic rubber – is increasing and the outlook is looking more positive.


Yago Veith
Despite the greater price pressures leading to regular stories of closures and production cutbacks at rubber plants globally, there have also been plenty of investments announced – particularly in developing markets such as Asia – where demand continues to grow rapidly.

Global synthetic rubber consumption is forecast to reach 13.4m tonnes/year by 2015 (see table) from 2010 estimates of 11.4m, according to a report from US-based Global Industry Analysts, published last October.

ASIA IS KEY
Potential growth in the relatively untapped Asian market is vast, with far fewer people owning cars than in the more-established Western countries.

Higher disposable income and a middle class keen to become more mobile are driving this trend. As a result, many players are keen to tap into these promising markets.

There will be around 1.4bn cars on the roads by 2020 – 50% more than today, according to a report from CEIC, Bloomberg and Erste Group Research. In China alone, there will be 120 cars per 1,000 inhabitants by the end of the decade, up from 40 cars per 1,000 people today.

Speaking in May about future plans for the company, Mukesh Ambani, chairman of India’s Reliance Industries Limited (RIL), pointed to the importance of Asia: “The big trend is that if you look at the next 10 years, the projections for automobile growth are all China, India and Asia-focused,” he said.

Ron Commander, head of butyl operations at German specialty chemicals supplier LANXESS, echoed this sentiment: “About 54% of my business is in Asia and half of that is in China,” he said, adding that he expects its butyl business in Asia to grow by a few percentage points above this figure in the coming years. The market is very tight at the moment, driven by the mobility megatrend and an Asian middle class that continues to grow and want cars, added Commander.

DEMAND UPSURGE
The economic downturn may have affected new vehicle sales and temporarily punctured demand for replacement tires, but improved consumer awareness, a growing emphasis on fuel efficiency and more-stringent environmental regulations have seen an increase in global demand for high-performance tires.

North America’s ScotiaBank Group forecasts that global automotive sales will climb to over 60m units this year, marking a 5% increase on 2010 figures.

Styrene butadiene rubber (SBR) remains the largest segment in the synthetic rubber market and is used to produce tires that ­provide improved abrasion resistance, safety and fuel efficiency.

Other rubbers also are dependent on the performance of the automotive industry, such as nitrile rubber (NBR) – used in hoses, seals and grommets – and butyl rubber.

Regular butyl rubber is predominantly used in tire tubes for cars, trucks and bikes with halo butyl being used in inner liners and having several medical applications.

The map below shows some of the upcoming synthetic rubber projects.

The focus of the map is Asia as the majority of these plants are being built to tap into the rapidly growing demand requirements in the region.



1: MAP TA PHUT, THAILAND
Bangkok Synthetics (BST) is planning to build the first solution-polymerization styrene butadiene rubber(S-SBR) plant at Map Ta Phut, Thailand, in partnership with Japanese producer JSR The plant will have a capacity of 50,000-100,000 tonnes/year and is slated to start operations in June 2013. Besides the project, BST says it is also building a commercial nitrile butadiene latex plant that should come on stream in 2012 as it is developing an nitrile butadiene latex business mainly for medical glove applications.

2: NANJING, CHINA
Chinese synthetic rubber producer YPC-GPRO (Nanjing) Rubber (YGC) is planning a 100,000 tonne/year butadiene rubber plant in Eastern China. Construction at the site in Nanjing Chemical Industry Park was expected to start in April, with testing scheduled for December 2012.

3: TIANJIN, CHINA
China’s Tianjin Lugang Petroleum and Rubber started up its new 100,000 tonne/year styrene butadiene rubber (SBR) plant in March. Butadiene (BD) feedstock is supplied by Sinopec-SABIC’s joint-venture extraction unit at Tianjin, while styrene is mainly outsourced.

4: NORTHWEST CHINA
Xinjiang Land Fine Petrochemical is expected to start up its new 50,000 tonne/year polybutadiene rubber (PBR) plant in Northwest China in June or July. Construction started in April.

5: YEOSU, SOUTH KOREA
Asia’s largest synthetic rubber maker, Korea Kumho Petrochemical Co. (KKPC), started commercial production at its new 120,000 tonne/year butadiene rubber (BR) plant at Yeosu, South Korea, in March 2011.

6: JURONG ISLAND, SINGAPORE
Japan’s Sumitomo Chemical announced in November 2010 that it planned to build a 40,000 tonne/year solution styrene butadiene rubber (S-SBR) plant in Jurong Island, Singapore. The unit will serve Asia’s growing demand for tires and is expected to start commercial production in the fourth quarter of 2013. The plant is Sumitomo Chemical’s first manufacturing facility in Singapore, and the producer planned to spend “over yen (Y) 10bn ($120m)” on the project.

7: TIANJIN, CHINA
China’s Tianjin Lugang Petroleum and Rubber achieved on-spec product at its new 100,000 tonne/year styrene butadiene rubber (SBR) unit in northern Tianjin in March 2011. It was originally scheduled to start up by the end of 2010, but was delayed due to technical issues.

8: JURONG ISLAND, SINGAPORE
Japanese producer Asahi Kasei Chemicals started construction of its 100,000 tonne/year solution styrene butadiene rubber plant in Singapore in early June. A 50,000 tonne/year line will be built at the Jurong Island site under the first phase of the project and should come on stream in June 2013. A second line of the same capacity is expected to start up in early 2015.

9: QUANZHOU, CHINA
China’s Fuxiang Chemical – a joint venture between Fujian Petrochemical Industrial (59.6%), Meizhouwan Chlor-Alkali Industry (30.4%) and Fujian Huaxing Group (10%) – was scheduled to start up its new 100,000 tonne/year styrene butadiene rubber (SBR) unit in April 2011. The plant in Quanzhou, Fujian province, had originally been scheduled to start up by the end of 2010. A 50,000 tonne/year polybutadiene rubber (BR) unit at the site has also been built.

10: DONGMING, CHINA
China’s Shandong Yuhuang Chemical announced plans in March to build a 50,000 tonne/yearethylene-propylene rubber (EPR) plant at Dongming in Shandong. The company suggested the facility was a great opportunity to serve an extremely tight EPR market. Construction will begin next year, with the plant expected to start up in 2013. Shandong Yuhuang is searching for another firm to jointly fund the facility, which will cost over yuan (CNY) 700m ($108m).

11: NANTONG, CHINA
Germany’s LANXESS and Taiwan’s TSRC are expected to invest $50m (€40m) in the construction of their joint venture 30,000 tonne/year acrylonitrile-butadiene rubber (NBR) plant at Nantong in Eastern China. The 50:50 joint venture – LANXESS-TSRC (Nantong) Chemical Industrial – is expected to start up in the first half of 2012.

12: JURONG ISLAND, SINGAPORE
Germany-based LANXESS says its €400m ($579m) butyl plant in Jurong Island, Singapore, is scheduled to come on stream in the first quarter of 2013 and is the company’s largest-ever single investment. LANXESS is expecting its new 100,000 tonne/year butyl rubber plant in Singapore to be mechanically complete by 2012. Site infrastructure will be finished by June next year, while the olefins plant that will supply raw materials to the facility will be completed by August 2012. The butyl unit will come on stream in two parts: polymerization and finishing is expected to be completed by September 2012 and the halo butyl unit by October.

13: KOLKATA, INDIA
Germany’s Wacker Chemie has commissioned a new silicone rubber compounding plant at its joint venture site Wacker Metroark Chemicals near Kolkata, India. Several million euros is being invested in the facility, which will be capable of producing a few thousand tonnes of silicone compounds annually. These will be used in India’s electronics, automotive and medium-to-high voltage insulator markets.

14: PANIPAT, INDIA
India’s first large-scale styrene butadiene rubber (SBR) plant will be built at Panipat by Indian Synthetic Rubber – a joint venture among IndianOil Taiwan’s TSRC and Japan’s Marubeni. An estimated $200m (€142m) is being spent on the 120,000 tonne/year SBR plant, which is scheduled for completion in 2013.