Lanxess: Synthetic rubber prices under further pressure

Cologne, Germany  - Synthetic rubber prices  are set to fall further in 2015 due in part to a decline in feedstock prices and overcapacity in the industry, a Lanxess spokesman has forecast.

In particular, the spokesman noted that the price for butadiene – a key raw material for synthetic rubber – had fallen in the last quarter of 2014. This, he said, was “leading to a pass-through of lower raw material prices to our rubber customers.”

Adding to the pressure on synthetic rubber prices are overcapacities in most product areas, continued the spokesman, noting that this issue looked set to intensify over the coming months.

“Additional capacities from new market entrants and existing competitors that will come on-stream in the near future will worsen the over-supply,” he said.

“What concerns us are existing overcapacities and how the market will react to those over time,” he added.

The spokesman went on to emphasise that the over-capacity applied mainly to general purpose grades such as Ni-PBR, which Lanxess does not produce. By contrast, he said, high-performance grades including Nd-PBR are experiencing significantly higher growth rates in demand.

Lanxess is starting up a new Nd-PBR facility in Singapore this year and the output, he said, “will be absorbed quicker in comparison to new capacities in more standardised grades.”