Chemical profile - polybutadiene rubber

02 March 2007 17:16 [Source: ICB Americas]

DEMAND

2005: 563,000 tonnes; 2006: 565,000 tonnes; 2010: 615,000 tonnes, projected. Demand equals production plus imports (2005: 103,606 tonnes; 2006: 76,197 tonnes) less exports (2005: 286,706 tonnes; 2006: 316,693 tonnes). Sources: ICIS Chemical Business Americas; USITC

GROWTH

Historical (2001–2006): 2.4%/year. Future: 2.2%/year through 20010. Source: ICIS Chemical Business Americas

PRICE

Historical (2001–2006): High, $1.15/lb., clear rubber grade, t.l. or c.l., f.o.b. works; low, $0.42/lb., same bases. Current: 90–95 cents/lb., same basis. Source: USITC

USES

Tires and treads for automobiles, trucks and buses, 76% (passenger car, 30%; truck and bus, 38%, tread rubber, 8%); high-impact resin modification, 20% (mainly for polystyrene and ABS); industrial products (conveyor belts, hoses, seals and gaskets) and other applications, 4%. Source: ICIS Chemical Business Americas

MARKET PERSPECTIVE

In the US, synthetic rubber demand increased by 2.4%/year since 2001, driven in large measure by improvement in the market for tires, the largest end use for products such as styrene-butadiene rubber (SBR) and polybutadiene rubber (BR). Tire products have been the mainstay of BR since its introduction in 1960. Performance rubbers formulated with BR can reduce a tire’s resistance to rolling, improving a vehicle’s fuel efficiency and can also improve a tire’s grip on wet roads.
According to the Rubber Manufacturers Association, US tire shipments increased by 2.5% in 2004 and 2.2% in 2005, but slipped 4.5% last year. The forecast for 2007 is for resumed growth, amounting to 310m units shipped, or a growth of 1.4%.
Impact modification of plastics is the most important nontire application of BR. It is mainly consumed in high-impact polystyrene. In 2006, an estimated 113,000 tonnes of BR was used, which represented 120% of total US demand. In addition to improving toughness, an impact modifier increases elongation, ductility and reduces environmental stress cracking. The downside to compounding with BR is a loss of clarity and large decrease in tensile strength and modulus.
Over the past five years, imports of BR have held steady, fluctuating about a mean average of 90,000 tonnes/year, but exports have grown steadily at an annual rate of 8.6%/year, reaching more than 316,000 tonnes in 2006.
On the supply side, the industry’s single biggest raw material, butadiene, has been tight for the past three years and its price has risen to historically high levels in reflection of this.

OUTLOOK

Technology is driving the tire polymers market. Innovations in the tire industry including better traction, lower rolling resistance, longer wear and run-flat capability are pressuring elastomer suppliers to improve their products in which the use of BR helps the manufacturer to tailor these features. Over the forecast period, growth is projected at 2.2% annually.

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Profile last published April 29, 2004
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US Polybutadiene Rubber
CAPACITY, tonnes/year

Company

Location

Capacity

American Synthetic Rubber

Louisville, Ky.

160,000

Bridgestone Americas

Orange, Tex.

150,000

Goodyear Tire
& Rubber

Beaumont, Tex.

250,000

LANXESS

Orange, Tex.

250,000

TOTAL

810,000

Tonnes per year polybutadiene rubber, net rubber basis (includes elastomer hydrocarbon and extender oils, but not carbon black). Commercial production is by solution polymerization of butadiene monomer. The capacities of American Synthetic Rubber, Bridgestone/Firestone and Goodyear are multipurpose and can produce solution polybutadiene rubber or solution styrene-butadiene rubber. LANXESS’ capacity at Orange, Tex., includes 25,000 tonnes of vinyl butadiene rubber, used for tire treads. Bridgestone/Firestone produces small quantities of high-vinyl polybutadiene at Lake Charles, La.

Last year, LANXESS announced it would reduce capacity of polybutadiene rubber at Orange, Tex., by the end of 2007. Four lines will be reduced to three in a restructuring move. In this move, installed capacity will diminish from 250,000, to 180,000 tonnes.

Bayer repackaged certain of its chemicals and polymers businesses into a separate legal entity named LANXESS, in 2004. The chosen business units for the new company were the more mature pieces that reflected GDP growth, including polybutadiene rubber. LANXESS was spun off in January 2005, to Bayer’s shareholders.

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