The global rubber industry constantly shows a wavering growth path depending on the fate of the automotive market. Although, there will be a constant demand for rubber, the need for better alternate of rubber is being considered seriously due to the depleting natural resources. Taking this into account, PBR and SBR are fast making a mark as greener and higher performance rubber in the industry.
From natural rubber to petroleum based synthetic alternate, rubber manufacturing has constantly addressed the need for change to come up with better quality, high strength rubber to meet the global demand. However, at present, rubber industry faces manufacturing dilemma like never before. Amidst an unpredictable automotive market, over supply of natural and synthetic rubber, increasing number of applications for rubber products, demand for high strength and environment-friendly rubber alternatives, the industry standards are constantly getting revised.
The rubber industry is dominated by the tyre market and although this industry is volatile to the rise and fall of the automotive industry, the demand for high-quality rubber is rising due to varied uses from bicycles, trucks, aircraft and automobiles to inflatable rafts, conveyor belts, rain coats, waterproof cloth tents etc, which are produced by amalgamating fabrics with rubber.
“The tyre industry is healthy, growing and offers attractive opportunities to grow profitably,” said Richard Kramer, chairman, chief executive officer and president, Goodyear Tyre & Rubber Company. “Our strategy is built to take advantage of key industry drivers including the transition to increasingly complex, large-rim diametre tyres and the growing influence of empowered consumers in all aspects of the tyre buying process.”
Construction-related products like rubber roofing etc are also growing. With this the global rubber processing chemicals market is expected to grow at a CAGR of 5.4 percent between 2015 and 2020, to reach $4.8 billion by 2020, according to Freedonia report.
Reports suggest that the tyre demand is projected to increase only modestly in developed nations. However, Asia Pacific is the largest producer and consumer of industrial rubber, and this booming growth is being supported by the rising living standards and growing numbers of vehicle purchases. Improving conditions in the mature markets of the US, Western Europe and Japan will also contribute to this growth. Along with robust original equipment manufacturing (OEM) market, sales of replacement tyres is also expected to have a fast expansion in the consumption requirements for synthetic and natural rubber in developing markets.
The global synthetic and natural rubber markets saw a slowdown in 2012, but with the reviving economy, the industry is on its growth track again. However, oil price volatility, environmental concerns and government regulations has a heavy impact on the growth of the rubber market. Demand for Polybutadiene Rubber (PBR) and solution styrene butadiene rubber (SBR) is also witnessing a growing demand for green and higher performance tyres. Green tyres have lower rolling resistance, which reduces vehicle fuel consumption.
Tyre labelling programmes which were made mandatory in Europe and South Korea and the adoption of similar programmes in other countries is also accelerating the shift toward more fuel-efficient tyres, and thereby increasing the PBR and solution SBR consumption.
To keep up with this trend, more and more companies are investing in research and development to achieve the goals of better efficient tyres. Recently, international technology company, Continental, announced that it has increased its R&D expense in 2016 by 13.2 percent yearon- year to €1.4 billion. “Our growing financial strength enables us to increase investment in research and development.
Zero road-traffic accidents, clean air and intelligent mobility are the relevant goals in this context,” said Dr Elmar Degenhart, chairman, executive board, Continental.
Global Butadiene Market
Off late, Asia-Pacific has stood out to be the world’s largest market of butadiene, as more than half of the total global demand of butadiene and its derivatives including styrene butadiene rubber (SBR), polybutadiene rubber (PBR), acrylonitrile butadiene styrene (ABS), and nitrile rubber (NR), is consumed within Asian Pacific. The use of butadiene is being diversified to wide range of applications. While China and South Korea pose as the biggest consumers of butadiene, India is expected to be among the fastest growing markets due to growing population, high economic growth favourable government policies and initiatives to promote industrial growth.
Around one-third of the total global demand of butadiene is being consumed to manufacture SBR especially in the US, China, South Korea and Japan. The SBR market is expected to grow at a CAGR of 6 percent to reach 8,201,902 tonnes by 2020 as per GBI Research.
China dominates the Asia Pacific market and shows a huge potential for SBR capacity addition, since it is a low operating cost destination, has become a global petrochemical products manufacturing hub and also has a regional increase in the demand from end-use sectors such as tyre, construction, automotive goods, mechanical goods, footwear.
South Korea and India are also expected to drive regional SBR growth rates. SBR offers greater flexibility, durability and barrier to emulsification in moist conditions. It also offers fuel efficiency with reduced CO2 emissions. Recently, the demand for Solution-Styrene Butadiene Rubber (S-SBR) has seen a dynamic increase over Emulsion SBR (E-SBR) which was more popular earlier due to its superior processing properties. However, the global need for high performance tyres which increase fuel efficiency, reduced rolling resistance, high traction during braking etc, is driving the demand for S-SBR in the tyre sector. The replacement of E-SBR with S-SBR is increasing in the EU due to new labelling rules is soon expected to be replicated in the other parts of the world.
The second largest consumption of butadiene is by PBR manufacturers making it one of the fastest growing end user segments. This growth is further expected to be accelerated with the overall growth in the automotive industry which will boost the demand for high quality, fuel-efficient tyres. Due to high resistance to wear, the demand for polybutadiene rubber is increasing (about 70 percent of total) in tyre production. While Asia Pacific is the leading consumer, China, Western Europe and USA together account forabout 80 percent of world PBR demand. Off late, there is a growing popularity of green tyres like neodymium polybutadiene rubber (Nd-PBR) which has in turn boosted the technological researches on neodymium catalyst technology.
In recent times, the rubber industry is in a slump due to an oversupply of natural rubber, cheaper materials available from Europe, US, Iran and Russia. However, most companies are taking up contingency plans to combat the situation. Like recently, German firm, Lanxess, announced its plans to restructure its ethylene propylene diene monomer (EPDM) rubber and neodymium-based performance butadiene rubber (Nd-PBR) production activities, to tackle over capacities for synthetic rubbers.
However, with the scope of rubber growing beyond automotive tyres making way for the requirement of rubber in multitude applications across the various industrial segment, is constantly making the need for high-quality rubber a necessity for the rubber industry.
Read More: Butadiene rubber for environment-friendly tyres
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