IISRP: Rubber demand growing despite global market woes

The global market for synthetic rubber is set to grow, helped by increasing demand in emerging markets, according to the International Institute of Synthetic Rubber Producers.

The growth is coming in spite of oil price volatility, environmental concerns, regulatory changes and trade actions, IISRP said in the 2018 edition of its Worldwide Rubber Statistics report. Rising prosperity from emerging countries should drive demand from the automotive, construction and manufacturing industries, an impact that will offset the negative effects the industry should experience.

The automotive industry, which represents about 75 percent of total rubber production services demand, remains one of the fastest growing industries in the world, according to Juan Ramon Salinas, the institute's MD and CEO noted in the WRS executive summary. Salinas also noted the auto industry's trend toward "eco-friendly rubbers" which are used to meet demand for fuel efficiency, light weighting and environmentally friendly components.Regionally, IISRP identified a slowdown in growth of production capacity in China that is mainly "due to the over-investment during the last decade." Despite the issues facing China, Salinas said, 2018 global production capacity figures show "a positive balance in terms of production capacity."

The overall balance, he said, reflected annual capacity increases totaling around 200,000 metric tons elsewhere in Asia Pacific, expansions in Russia, production capacity rationalization in Africa and idle facilities still in place in China.

The report also includes an update on the short-term outlook for new projects and expansions. It expects to see "moderate growth" between 2019 and 2021 compared to previous estimations.About 80 percent of forecast new production capacity and expansions will be for styrene-butadiene-based products, Salinas said, adding that "delays or cancellations are expected based on market performance."

The 2018 edition of the WRS includes revisions to elastomer plant capacities, and IISRP's China office has played a part in enhancing the intelligence on the Chinese market, according to an IISRP release.