Sufficient Raw Materials and Mature Technology Guarantee China’s Isoprene Rubber Industrial Development

By Jia Dongmei, China National Chemical Information Center

Isoprene Rubber (IR) is a rubber variety synthesized from isoprene monomer. The structure and properties of IR are similar to those of natural rubber, so it is also called synthetic natural rubber. IR features good original rubber strength, basic viscosity, anti-aging and elasticity, therefore it is an important raw material for the replacement of natural rubber in the production of passenger car tires, bias tires, heavy-duty radial tires, semi-steel car radial tires, light truck radial tires, etc. IR is also used to make cord fabric adhesive, conveyor belts, machinery products, rubber hoses, adhesive tapes, sponges, adhesives, wires and cables, sports equipment, medical equipment, rubber shoes, etc. It can be used alone or with natural rubber or other synthetic rubbers.

Production grows fast in China

In the 1960s, Changchun Institute of Applied Chemistry (CIAC) of the Chinese Academy of Sciences announced the synthesis of high cis structure polymer through diene polymerization using Nd catalyst for the first time in the world. In the 1970s, a ternary catalyst system consisting of rare earth carboxylate salts, alkyl aluminum and chloride, and binary catalyst system consisting of rare earth chloride complexes and aluminum alkyl were defined to synthesize IR, cis IR was synthesized using rare earth ternary catalyst, and the laboratory and pilot tests of aluminum and titanium system was carried out in PetroChina Jilin Petrochemical Company Research Institute. In April 2010, Guangdong Maoming Luhua Chemical Co., Ltd, a wholly owned subsidiary of Luhua Hongjin Chemical Co., Ltd, started up its 15 thousand t/a IR unit – China’s first IR industrial production unit, and developed several product brands with different Mooney viscosity index such as LHIR-60, HIR-70, LHIR-80 and LHIR-90. Qingdao ECSS Advanced Materials Co., Ltd completed the construction of the 30 thousand t/a Nd-IR project in October 2010, and put it into operation in 2011. Qingdao ECSS Advanced Materials Co., Ltd’s IR production technology and industrialization development project passed experts’ appraisal organized by Department of Science & Technology of Shandong province in December 2007. The technique uses the Nd catalyst solution polymerization process to produce IR.
   Before 2010, China’s IR consumption was almost entirely dependent on imports. Since 2010, with the startup of the new units, both the production capacity and output of IR in China have increased year-by-year. In 2010 China’s capacity to make IR was 15 thousand t/a and the output was 10 thousand tons. The capacity to produce IR in China reached 46 thousand t/a in 2011, the output climbed to 18 thousand tons and the operating rate was 39%. In the next few years, China will also construct a number of new/planned IR projects.

1 Fushun ECSS Advanced Materials Co., Ltd

Fushun ECSS Advanced Materials Co., Ltd, located in Fushun High-tech Development Zone, is a wholly owned subsidiary of Qingdao ECSS Advanced Materials Co., Ltd with registered capital of RMB100 million. In December 2009, the company invested RMB960 million to construct a 150 thousand t/a ethylene cracking C5 fractions plant and 40 thousand t/a IR plant. In December 2011, Fushun ECSS Advanced Materials Co., Ltd formally put its C5 separation unit using acetonitrile process into operation. In April 2012, the 40 thousand t/a IR project met the trial production conditions.

2 PetroChina Jilin Petrochemical Co., Ltd

During the 12th Five-Year Plan period (2011-2015), PetroChina Jilin Petrochemical Co., Ltd plans to construct a 60 thousand t/a IR unit.

3 Sinopec Beijing Yanhua Petrochemical Co., Ltd

Sinopec Beijing Yanhua Petrochemical Co., Ltd’s IR unit with a design capacity of 30 thousand t/a, which is planned to be constructed in the eastern region of the company, uses the rare earth catalytic polymerization IR technology and polymerization reaction process developed by Sinopec Beijing Yanhua Petrochemical Co., Ltd and Yanshan Branch of Beijing Research Institute of Chemical Industry with intellectual property rights, and all equipment is manufactured by domestic firms. The IR unit’s raw material polymerization grade isoprene is supplied by the new 150 thousand t/a C5 separation unit in Sinopec Beijing Yanhua Petrochemical Co., Ltd. The foundation design of the project passed the examination in July 2011.

4 ZiBo Luhua Hongjin Chemical Co., Ltd

ZiBo Luhua Hongjin Chemical Co., Ltd plans to construct a 50 thousand t/a IR plant in Eastern Chemical Zone of Zibo, Shandong province. The plant with a total investment of RMB300 million is planned to be put into operation in 2012.

5 Panjin Zhenao Chemical Co., Ltd

Panjin Zhenao Chemical Co., Ltd is controlled by Panjin Heyun Industrial Group Co., Ltd. The company, which is located in Panjin of Liaoning province, constructed the Synthetic Rubber Industrial Park in Panjin Liaobin Coastal Economic Zone. Panjin Zhenao Chemical Co., Ltd plans to invest RMB6.2 billion and import Nd-IR technology and trans IR technology from Russia to construct 400 thousand t/a IR project. The project includes two phases, of which the first phase has a capacity of 50 thousand t/a.

6 Qingdao Dipai New Material Co., Ltd

In July 2010 Qingdao Dipai New Material Co., Ltd started the construction of a 30 thousand t/a trans 1,4 polyisoprene (TPI) project in Laixi of Shandong province. The project includes four production lines and is planned to be completed and put into operation in 2012.
   In addition, domestic enterprises that prepare to construct new C5 comprehensive utilization units typically consider also building IR units.
   In recent years, domestic demand for IR has been mainly satisfied by imports. China’s import volume of IR was only 22 thousand tons in 2006 and increased to 66 thousand tons in 2010. In 2011 China imported 50 thousand ton of IR, of which the import volume of IR in primary forms was 5 thousand tons and the amount of IR in plates, sheets or strips imported was 44 thousand tons, down 24.5% year-on-year. In recent years, there have been no big changes in China’s export volume of IR. In 2011 China exported 2 122 tons of IR, down 19.4% year-on-year.

Tire manufacture is the major sector consuming IR

The structure and properties of IR are similar to those of natural rubber, so IR has extensive application. IR can be used alone or with natural rubber or other synthetic rubbers. In 2011 China’s IR consumption was 65 thousand tons, of which around 86% of IR was used to produce automobile tires, and around 14% was used in rubber products and other sectors.

A. Automobile tires

In the automotive industry, IR is mainly used to produce all kinds of radial tires.
In the production of semi-steel radial tires, the use of IR in carcass ply compound can reduce the frost spray and polyester cord aminolysis. A small amount of IR is used in the tread compound and sidewalls. It is used in part of triangular rubbers.
In bias tires, no more than 30% IR being used to replace the equal amount of natural rubber can be used in parts like tread, carcass and sidewall, etc.
   In all-steel heavy-duty radial tires, IR can partially replace natural rubber to be used in the tread compound, carcass ply compound, shoulder wedge, belt compound, triangle rubber, bead wire compound and sidewalls, the consumption proportion of IR is no more than 40%, and the IR application field is more extensive. In addition to replacing natural rubber and reducing production costs, IR can improve the performance of tire compound. For example, IR can improve the process performance, the tire compound has higher hardness, tear resistance and fatigue resistance while at the same time it has better mobility, the steel wire surface is evenly covered with tire compound, so IR is the first choice for application in all-steel heavy-duty radial tires.
   In giant engineering tires, the application of IR is similar to that in all-steel heavy-duty radial tires. However, the puncture resistance of engineering tires has higher requirements on tread compound. The tire thickness requires lower heat generation or faster heat dissipation and the requirement on the heat aging properties is higher. Therefore, the use of IR with natural rubber is selected in priority, according to the characteristics of IR.
   In inner tubes, 15% IR being used to replace the equal amount of natural rubber can improve the production efficiency and reduce the energy consumption.
Therefore, it is expected that a breakthrough may be achieved in all-steel heavy-duty radial tires and engineering radial tires in the future. However, the total consumption of IR in each tire still depends on the IR supply and the price difference between IR and natural rubber. In 2011 China’s tire sector maintained stable growth. The output of tires in China reached 832 million pieces, a year-on-year growth of 8.55%. Of the total, the output of radial tires was 393 million pieces, accounting for 47.25% of the total. In 2011 the consumption of IR in the automobile tire sector was around 56 thousand tons, accounting for around 86% of the total.

B. Rubber products and other sectors

China’s IR is also used to produce rubber hoses and adhesive tapes. As an alternative to natural rubber, IR is used in folder cloth and cotton type hoses. Tire compound has good processing properties, does not require filtering and plastication, can reduce energy consumption and simplify manufacturing procedures. In the formulation, 60% IR being used to replace the equal amount of natural rubber can slow the vulcanization speed, and 0.2%-0.5% vulcanization accelerators need to be added in the original formulation to adjust the vulcanization speed. IR is also used to produce rubber products like rubber shoes, rubber conveyor belts, foam rubber products, etc. In the rubber shoes sector, IR is more transparent than natural rubber, has the processing performance of natural rubber and can replace natural rubber to produce all parts of rubber shoes. In addition, Nd-IR and Li-IR can also be used in light-colored products, pharmaceutical and food grade rubber products. IR is also used to produce fine macro molecular chemicals like the negative photoresist. In 2011 the consumption of IR in rubber products and other sectors was around 9 thousand tons, accounting for around 14% of the total.
   IR is researched and developed as a substitute for natural rubber, so its future development is closely related to natural rubber. The supply/demand status and price of natural rubber directly affect the development of IR. In recent years, due to the rapid development of automobile industry, China’s capacity to make tires has expanded rapidly, causing drastic growth of natural rubber consumption in China. In 2011 China’s consumption of natural rubber exceeded 3.5 million tons, accounting for more than 1/3 of the world’s total. Due to the geographical location and climate conditions, the output of natural rubber in China has not grown substantially. In 2011 China produced 687 thousand tons of natural rubber, and the nation’s dependency on imported natural rubber was over 80%. Therefore, to reduce its dependence on imports, China is investing to construct natural rubber plantations in foreign regions suitable for rubber planting, accelerating the development of IR that is a stronger alternative for natural rubber and promoting the development of scrap tire comprehensive utilization sector. At present, China’s development of IR is aimed to replace natural rubber in order to alleviate the tight supply of natural rubber. In terms of quality, the competition between IR and natural rubber mainly depends on their price ratio. However, on the other hand, in addition to price, tire enterprises’ acceptance of IR is also a big factor affecting the consumption of IR. At present, domestic tire enterprises do not have much related experience, and the IR consumption in developed countries only accounts for 3%-5% of the total natural rubber consumption.

Increase of market demand

In recent years, China’s IR consumption has been mainly dependent on imports and the market prices depend on import prices, so the changes in import prices can be used to describe the changes in the market prices. Since 2002 China’s price of conventional IR has increased constantly. In 2008 the annual average price of imported IR in primary forms and in plates, sheets or strip was US$2 927 per ton and US$2 912 per ton, respectively. Due to the impact of the financial crisis, the annual average price of imported IR in primary forms and in plates, sheets or strip reduced to US$2 365 per ton and US$1 841 per ton, respectively in 2009. Because of the implementation of the policies for economic recovery, the rapid development of China’s automobile industry as well as the significant price rise of natural rubber, the IR price has begun to rise once again. In 2011 the annual average price of imported IR in primary forms and in plates, sheets or strip reached US$4 500 per ton and US$4 436 per ton, respectively, hitting the historical high level.

Raw material supply is guaranteed

Before 2009 China’s IR was entirely dependent on imports. Since 2010, with the startup of Guangdong Maoming Luhua Chemical Co., Ltd’s 15 thousand t/a IR unit and Qingdao ECSS Advanced Materials Co., Ltd’s 30 thousand t/a Nd-IR unit in succession, China has begun to produce IR. In 2011 China’s IR output and consumption was 18 thousand tons and 65 thousand tons, respectively, and the self-sufficiency rate reached 27.5%. In the next five years, with the startup of China’s new/planned IR projects in succession, driven by the downstream sectors like automobile tires and rubber shoes at the same time, China’s IR output will grow rapidly.
   Although IR has a huge market potential, its practical applications also need to be expanded further. At present, IR development is one of the hot topics in China’s rubber sector. There are several main reasons for this. First, the output of natural rubber in the world is limited, the supply is insufficient, the price gradually increases and the cost of the rubber processing sector climbs, so players hope to find a substitute for natural rubber. Second, China is increasingly rich in C5 resources, IR purification technology has gradually matured, offering sufficient conditions for IR industrialization. Third, the constant fluctuation of oil prices causes the increasing price fluctuation of raw materials and the production cost of IR fluctuates increasingly. The IR market is greatly influenced by the price of natural rubber. When the price of natural rubber is low, the IR market will also shrink. When the price of natural rubber is high, the production and application of IR will rebound drastically. Therefore after industrialization, the market prospect of IR is uncertain.

Table 1 China’s Major IR Producers in 2011 (thousand t/a)
Producer    Capacity    Remarks
Guangdong Maoming Luhua Chemical Co., Ltd    15    Rare earth catalyst solution polymerization process
Qingdao ECSS Advanced Materials Co., Ltd    30    Rare earth catalyst solution polymerization process
PetroChina Jilin Petrochemical Company Research Institute    1.0    Rare earth catalyst solution polymerization process
Total    46    
Source: CNCIC

Table 2 Import and Export of IR in China during 2006-2011
Year    Import volume(kt)    Import value (US$ million)    Export volume(kt)    Export value(US$ million)
2006    22    44.36    1.597    4.31
2007    53    106.17    1.627    3.22
2008    33    96.52    3.134    9.28
2009    36    72.61    1.149    2.84
2010    66    198.09    2.632    8.57
2011    50    220.22    2.122    9.49