Zeon accelerates exit from ESBR, NBR latex as portfolio overhaul advances

Tokyo – Zeon Corp. is moving ahead with plans to streamline its elastomers portfolio, confirming that production at its first emulsion styrene-butadiene rubber (ESBR) line will cease during the current fiscal year (started 1 April).

The group has also ended the production of nitrile butadiene rubber (NBR) latex ahead of schedule, said Zeon in a 10 June update of its mid-term management strategy for fiscal years 2025 – 2028.

The update marks the latest step in Zeon's previously announced strategy to withdraw from 'lower-profitability rubber products' and shift resources towards higher-margin businesses and growth areas. (ERJ report)

At the time, Zeon said it intended to discontinue production of ESBR 1 and NBR latex by 2026 and subsequently phase out butadiene rubber production at Tokuyama from 2028 onwards.

While reducing exposure to commodity elastomers, Zeon said it would continue to position selected speciality rubbers as strategic growth businesses.

In the latest portfolio review, solution styrene-butadiene rubber (SSBR) and hydrogenated nitrile rubber (HNBR) remained classified as "growth drivers" alongside battery materials and cyclo olefin polymer (COP) products.

The group said growth-driver businesses will be supported through “capacity expansions and optimisation of production systems during the current phase of the strategy.”

Zeon also highlighted SSBR among products recognised for contributing to its sustainability goals, citing the material's role in fuel-efficient tires through lower rolling resistance, improved wear resistance and reduced particulate emissions.

The Japanese group also revised its 2028 outlook for the elastomer materials segment, raising the sales target to Yen220 billion (€1.2 billion) from a previous Yen214 billion estimate.

However, the operating profit target for the division has been reduced to Yen10.5 billion from an earlier projection of Yen14.7 billion, reflecting a broader reassessment of the segment mix.

Alongside the portfolio changes, Zeon pointed to investments in sustainable raw-material technologies linked to the rubber sector.

Under a project backed by Japan's Green Innovation Fund, Zeon is developing technology to produce butadiene from ethanol and is also working on bio-butadiene and bio-isoprene production routes based on plant-derived feedstocks.

A bench-scale facility for ethanol-to-butadiene technology is scheduled to start operation at Tokuyama in 2026. (ERJ report)

Zeon is also advancing a collaboration with California-based Visolis to prepare commercial-scale production facilities for bio-isoprene monomer and sustainable aviation fuel (SAF).