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March 14, 2013

Ube establishes JV for synthetic rubber production in Malaysia

Gerald Ondrey

Ube Industries, Ltd. (Ube; Tokyo, Japan; has established a joint venture (JV) with Lotte Chemical Corp. (Seoul, South Korea), Lotte Chemical Titan Holding Sdn. Bhd. (Kuala Lumpur, Malaysia), and Mitsubishi Corp. (Tokyo, Japan) to manufacture and market butadiene rubber (BR) in Johor, Malaysia. The move is in response to growing demand for BR in the Asia region.

The JV will be licensed manufacturing technology from Ube Industries, and will construct manufacturing facilities capable of producing 50,000 metric tons (m.t.) of BR annually. Lotte Chemical Titan Holding of the Lotte Chemical Group will supply the JV with raw material butadiene, with manufacturing scheduled to start in 2014. In addition, the JV has plans to add a further 22,000 m.t./yr of production capacity as demand dictates.

The main applications for BR are for use in tires, high impact polystyrene (HIPS), and shoe soles. Demand for BR is expected to grow by some 6–7% in the future, centering on the Asian market which is the biggest market for BR. In the tire market, many BR users centering on major tire manufacturers are moving ahead with plans to increase their production capacity in the Asia region.

Ube Industries maintains a global framework for BR production with plants in Japan, China, and Thailand. The production capacity in Chiba, Japan currently stands at 110,000 m.t./yr, with a capacity of 72,000 m.t./yr in Thailand and China respectively for a total capacity of 254,000 m.t./yr. Ube Industries also plans to add a further 16,000 m.t./yr of production capacity in Chiba, Japan in late 2013.

Lotte Chemical maintains its own global framework for BD production with two plants in South Korea (Daesan and Yeosu) having a production capacity of 150,000 m.t./yr each, and a Group plant in Malaysia operated by Lotte Chemical Titan Holding with a production capacity of 100,000 m.t./yr.

The establishment of the JV will enable Ube Industries to fully leverage the capacities at four global bases of production, as the company seeks to further strengthen its presence in the growing Asian market.



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