Evonik Industries will localise production of a key tyre additive in Shanghai, marking a strategic shift to enhance supply security across Asia amid growing regional demand.

The Essen-based company announced plans to establish the final production step of its POLYVEST ST-E 60 product at its Shanghai facility, with operations expected to commence by the third quarter of 2025. The expansion will significantly increase the global production capacity of silane-functionalised polybutadienes.

The move represents Evonik’s latest effort to strengthen supply chains and reduce dependency on European manufacturing for Asian markets. POLYVEST serves as a reactive plasticiser in tyre formulations and is also used in rubber compounds, adhesives, tyres, coatings, and sealants.

“This strategic investment will enhance our production capabilities and ensure that our customers in Asia benefit from improved supply security and shorter lead times,” said Dr Anna Maria Ickert, Head of Evonik Coating & Adhesive Resins. “In today’s environment, fostering independent supply chains and bringing our products closer to our customers is essential, enabling us to respond more effectively to their needs.”

The Shanghai expansion comes as global chemical companies reassess manufacturing footprints following supply chain disruptions experienced during the pandemic and ongoing geopolitical tensions. China remains a crucial market for speciality chemicals, particularly in the automotive and construction sectors.

Evonik’s decision reflects broader industry trends towards regionalisation of production, with companies seeking to reduce logistics costs whilst improving responsiveness to local market demands. The tyre industry, a key end-market for POLYVEST, has experienced robust growth in Asia driven by expanding automotive production.

Dr Jürgen Herwig, Head of Evonik’s polybutadienes and speciality acrylics business, emphasised the expansion’s strategic importance. “This expansion aligns with our long-term strategy to strengthen our global footprint while maintaining a strong focus on sustainability and operational excellence,” he said. “The new capacity will enable Evonik’s customers to achieve their business goals while participating in the region’s growth.”

POLYVEST products utilise rubber-based chemistry to ensure compatibility with tyre tread compounds, thereby addressing performance requirements in an increasingly demanding automotive market. The localisation strategy aims to reduce lead times whilst maintaining product quality standards.

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Kuraray Asia Pacific Pte. Ltd., a subsidiary of Kuraray Co., Ltd., has inaugurated the Kuraray Asia Pacific Centre in Singapore's Science Park. This new facility will function as a dedicated technical support hub for the Asian market. Its primary focus will be on providing specialised expertise for growing regional demand in PVOH resin, EVAL EVOH resin and activated carbon products.

Equipped with advanced material evaluation and analysis laboratories, the centre is designed to deliver prompt and tailored solutions to meet specific local customer requirements. It will also act as a platform for open innovation, fostering collaborative development and product demonstrations to generate new value.

By establishing itself within the concentrated research environment of the Singapore Science Park, the centre aims to accelerate market development and attract global talent through strategic partnerships. This initiative is a key part of the Kuraray Group's strategy to address emerging customer needs, explore new applications and strengthen its overall business expansion throughout the region.

Lim Wey-Len, Executive Vice President, Singapore Economic Development Board, said during the opening ceremony on 1 September: “We welcome Kuraray and other like-minded companies to leverage Singapore’s innovation ecosystem, talent pool, and regional connectivity to scale impactful and sustainable solutions from here.”

Tomoyuki Watanabe, Director and Managing Executive Officer, and President of the Vinyl Acetate Resin Company at Kuraray, said, “By offering a place for co-creation with our customers, we hope to drive the rapid market growth in the region.”

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The Association of Natural Rubber Producing Countries (ANRPC) has released its Monthly NR Statistical Report for July 2025, providing an overview of key developments in the global natural rubber sector.

According to the report, natural rubber prices exhibited significant volatility in July. This instability was driven by a combination of adverse weather conditions impacting production, ongoing geopolitical tensions and international trade tariffs. After an initial phase of ample supply and muted demand, market sentiment shifted as concerns over potential supply disruptions prompted a notable increase in purchasing activity.

The report further projects a modest global production increase of 0.5 percent for 2025, while demand is anticipated to grow by a slightly higher 1.3 percent. However, this growth is expected against a challenging backdrop of a potential global economic slowdown. Complex US tariff policies and their widespread ripple effects are primary factors contributing to what may become one of the most subdued years for economic expansion since the pandemic.

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Continental is establishing a groundbreaking industrial process for recycling complex rubber waste through a strategic acquisition of key patents and the launch of a new pilot facility. This initiative, led by its ContiTech division, leverages advanced pyrolysis technology to transform end-of-life rubber products into valuable raw materials, creating a sustainable alternative to fossil resources.

The core of this innovation is a thermal decomposition process where waste rubber is heated in a low-oxygen environment. This breaks the material down into its core chemical constituents, one of which is a high-quality oil with properties mirroring traditional crude oil. This output is particularly significant as it can be directly used in the manufacture of new plastics and rubber goods, effectively closing the material loop.

A major historical obstacle for the industry has been the difficulty of recycling vulcanised rubber, whose altered chemical structure resists conventional separation methods. Pyrolysis successfully circumvents this challenge, cleanly decomposing the material to recover not only oil but also carbon black and other energy sources. The widespread adoption of pyrolysis has been hindered until now by the complexity of purifying its outputs to meet industrial standards. Continental’s new facility, originally developed by British start-up LowSulphurFuels, directly addresses this hurdle with a specialised purification process, making large-scale rubber recycling both technically feasible and economically attractive.

This advancement is especially critical for complex rubber products like composite hoses and specialised seals, which were previously nearly impossible to recycle efficiently. By converting this challenging waste stream into a high-grade resource, Continental is driving progress towards a circular economy. This move also reinforces the company's position as a leader in sustainable innovation, complementing its extensive patent portfolio and ongoing projects focused on material recovery and developing eco-friendly solutions for the automotive and industrial sectors.

Dr Michael Hofmann, Chief Technology Officer, ContiTech, said, “With this technology, we’re closing a crucial gap in the circular materials economy: we’re able to recover high-quality raw materials from rubber waste, which we can then feed back into the chemical material cycle to create new products without relying on crude oil. We’re thus demonstrating how innovation can become the driving force behind sustainable industrial processes – and how a previously untapped raw material cycle can be made economically viable.”

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Following a resolution by its Board of Directors on 29 August 2025, Zeon Corporation has formally revised the total investment for its upcoming cyclo olefin polymer (COP) production plant. The new total investment is now projected to be approximately JPY 78.0 billion (approximately USD 525.70 million), a significant increase from the initial estimate of approximately YEN 70.0 billion (approximately USD 471.77 million) announced in June 2024.

This upward revision is attributed to anticipated increases across key construction areas, including rising costs for labour, raw materials and equipment. The updated financial framework incorporates both confirmed and projected cost escalations to ensure accurate budgeting. Zeon Corporation intends to fund the entire investment through a combination of internally generated capital and loans from financial institutions.

The new facility remains on schedule for completion in the first half of fiscal year 2028. Due to this timeline, the substantial investment is not expected to materially affect the company's consolidated financial results for the fiscal year ending 31 March 2026. The project is a central pillar of the company’s medium-term business strategy, identified as a major future growth driver.

The decision to proceed with the plant underscores the strong market outlook for Zeon’s cyclo olefin polymers. These advanced materials are prized for their superior optical clarity, extremely low water absorption and high purity. While already established in applications like optical films and lenses, demand is growing rapidly from the medical and semiconductor industries. By expanding its production capacity, Zeon aims to capitalise on this robust and expanding demand, thereby strengthening its market position and enhancing its corporate value over the medium to long term.

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