26 July 1999 00:00 Source:ICIS Chemical Business
Asian exports of SBR to Europe over the past year led the market into oversupply. But the recent upturn in Asian economies has stemmed the flood of exports and European supply has become more balanced


The styrene butadiene rubber (SBR) market in Europe has been in oversupply in the past year, mainly the result of large import quantities available at relatively lower prices. Most of the imports originated from Asia where tyre demand slowed down dramatically in line with the economic crisis.

However, the Asian economies have now turned around and this has propped up consumer demand for cars and SBR as a result. Consequently, exports to Europe have dropped and supply has become more balanced.

As a result of weakening rubber prices, a number of SBR end-users have reportedly been switching over to natural rubber (NR) which is relatively cheaper. However, market analysts at LMC International believe this factor has been exaggerated. Substitution in tyre manufacturing is not a short-term decision, because of the high-tech manufacturing process and recreditation required for a switch from NR to SBR. Only 5% of tyre compounds can be substituted for SBR, says LMC. The major European SBR producers include Bayer, EniChem, Dow Chemical, Fina and Repsol. Dow recently acquired Shell Chemicals' general purpose rubber businesses, including SBR.


About 70% of all SBR elastomer produced in Europe and North America is used in car tyre manufacturing. Adhesives and chewing gum has been identified as two growing markets for SBR applications. However, vehicle sales are the key determinant of demand for tyres, which in turn affects demand for SBR.



SBR is produced by the copolymerisation of butadiene with styrene in the approximate proportion of 3:1 by weight. In the emulsion process producing general purpose grades, the feedstocks are suspended in a large proportion of water in the presence of an initiator or catalyst and a stabiliser. A solution process is also employed where the copolymerisation proceeds in a hydrocarbon solution in the presence of an organometallic complex. Licensors of SBR technology include EniChem and Japan Synthetic Rubber.

Health & safety

Vapour from heated SBR may cause irritation of the skin and eyes. Inhalation of dust can lead to respiratory irritation or sensitisation. Toxic fumes can be given off in a fire.


The west European SBR spot market offers various grades that split into the two main emulsion and solution categories. SBR 1712 and 1500 oil extended fall under emulsion grade while 1205 comes under solution grade. According to ICIS-LOR, the latest emulsion grade 1712 average monthly spot price for July is DM975/tonne FD NWE, and emulsion grade 1500 July average spot price is DM1075/tonne FD NWE. The solution grade 1205 July average spot price is DM1860/tonne FD NWE. Prices for all three grades have stabilised after bottoming out in April/May this year. Quarter three contract business was recently concluded at a roll-over level. Emulsion grade 1500 and 1502 was done at DM1250/tonne FD NWE and 1712 at DM1110/tonne FD NWE. Suppliers are angling for a significant price hike for quarter four business in recognition of rising benzene, styrene and butadiene feedstock prices in recent months. No price ideas were disclosed as ECN went to press.

Natural rubber prices have also been plummeting in an oversupplied global market. NR TSR 20 (technically-specified rubber) was trading at 38 pence/kg as ECN went to press. Analysts believe NR prices have bottomed out.


Company Location Capacity

Western Europe

Bayer Elastomers Port Jerome, France 29

Bayer Polymers La Wantzenau, France 75

BSL Olefinverbund Schkopau, Germany *90

Dow Chemical Pernis, Netherlands 150

EniChem Grangemouth, UK  20

EniChem Hythe, UK 110

EniChem Ravenna, Italy 220

Fina Antwerp, Belgium 25

Michelin Bassens, France 40

Polymer Latex Filago, Italy 16

Repsol Quimica Santander, Spain 30

Eastern Europe

ZC Oswiecim Oswiecim, Poland 130

FSK Zrenjanin, Serbia 45

Neftochim Burgas, Bulgaria 30

Petro Borzesti Borzesti, Romania 150

Unipetrol Kralupy, Czech Republic 71

* 80% Dow, 20% BVS

  swing with PBR

Source: CMAI


SBR demand in Europe is expected to grow at around 2-3%/year over the next few years, even though the level of automotive production has reached close to saturation point. However, demand will continue to remain steady as long as economies continue to perform well. An increasing number of west European tyre manufacturers have invested in central Europe in an attempt to plug into the region's higher growth in domestic demand for automobiles.

According to the International Institute for Synthetic Rubber (IISRP), an annual growth rate of 4.1% in SBR consumption is predicted in central Europe in the next five years. In western Europe, there was a 5.4% increase in overall synthetic rubber consumption in 1998, and consumption is expected to grow at 1.9%/year between 1999-2003 to 2.9m tonne at the end of this period. Total SBR consumption in western Europe, including emulsion and solution grade, rose 5.2% to 653 000 tonne in 1998.