By Yan Feng

With the chemical composition, molecular structure and mechanical properties all similar to natural rubber, polyisoprene rubber also has good performances such as basic viscosity, aging properties and resilience and hence is an important raw material alternative to replace natural rubber in the production of passenger vehicle tyre, bias tyre and radial tyre. In addition, it can also be widely used in other fields, including curtain rubber, conveyor belts, hoses, adhesive tapes, sports equipment, and medical materials.

Production

   China had no polyisoprene rubber plant prior to 2009, and all the products depended on imports. In April 2010, Guangdong Maoming Luhua Chemical Co., Ltd. set up a 15 kt/a polyisoprene rubber plant using rare earth catalysts. Since then, more plants have been built and launched, including Luhua Hongjin Chemical (Zibo) Co., Ltd., Fushun Yikesi New Material Co., Ltd., Sinopec Yanshan Petrochemical Company, Shandong Shenchi Petrochemical Co., Ltd., Qingdao Dipai New Material Co., Ltd., Zhejiang Jinhai Chenguang Chemical Co., Ltd. and Dushanzi Tianli Industrial Corp, contributing to a massive expansion of polyisoprene rubber capacity in China.

   The capacity was 290 kt/a in 2018, covering grades such as rare-earth polyisoprene rubber, lithium-based polyisoprene rubber and trans-polyisoprene rubber. Fushun Yikesi New Material Co., Ltd. was the largest producer, with a capacity of 70 kt/a (two plants, located in Qingdao and Fushun), accounting for 24.14% of the total domestic capacity, followed by Luhua Hongjin Chemical Co., Ltd. (including Zibo and Maoming plants), with a capacity of 65 kt/a, accounting for 22.41% of the total capacity. China’s major polyisoprene rubber producers for 2018 are listed in Table 1. 

   Table 1   China’s major caprolactam producers in 2018

Import & export

   The majority of Chinese polyisoprene rubber products have been stuck in homogeneous competition, as the supply of high-end products is limited and has to rely on import. In 2010, the import volume of polyisoprene rubber in China was 65.7 kt, an increase of about 81.49% YoY; in 2014, the import volume was 21.7 kt, down by 45.48% YoY; in 2018, the volume was 32.3 kt, down by 26.09% YoY. While importing, China exports a small number. In 2010, the export volume was 2 600 tons, an increase of 136.36% YoY; in 2014, the volume was 1 800 tons, down by 30.77% YoY; the export volume in 2018 was 1 600 tons, down by 27.27% YoY.

   The polyisoprene rubber imports are mainly originated from Russia and Japan. In 2018, their imports accounted for 90.9% of the total imports, down by about 22.9% YoY, with the volume from Japan taking up 36.6%. 

Consumption

   In 2018, the apparent consumption of polyisoprene rubber in China was 86 kt, a decrease of 14.0% YoY, and the self-sufficiency rate was 64.0%. At present, the consumption structure of polyisoprene rubber in China is: the demand accounts for 63% in the tire industry, 18% in medical industry, 15% in shoe materials sector and 4% in other sectors.

   The demand for polyisoprene rubber is mainly affected by downstream producers’ using habits, the cost of raw material isoprene, as well as natural rubber supply and prices. It is unlikely that China's natural rubber production will have a significant increase, thus importing will still be highly depended. Against the backdrop, it is a way out to develop the substitute rubber for natural rubber. Polyisoprene rubber stands out with the similar molecular structure and properties. If the supply of good-quality polyisoprene rubber is stable and the technology is upgrading, the price will be competitive and the demand for polyisoprene rubber will gradually increase. It is estimated that the actual demand for polyisoprene rubber in China will be around 150 kt by 2022, with a self-sufficiency rate of 65-70%.

Prices

   The prices of polyisoprene rubber in China are determined by downstream demand, as well as prices of raw material isoprene, natural rubber and imports. The prices kept falling during January-August 2018, and rose slightly in September and afterwards. The annual average price was RMB19 189/t, down by 7.78% YoY, with the highest seen in January, at RMB22 500/t, and the lowest in August, at RMB18 000/t. It is expected that the prices will continue to fluctuate within a range that is not very big in 2019.

Future development

   Liaoning Panjin Heyun Group, Sinopec Fujian Refining and Chemical Company, Shandong Yuhuang Chemical Co., Ltd., and PetroChina Lanzhou Petrochemical Company had planned to build new polyisoprene rubber plants during the Twelfth Five-Year Plan period, but underperformed operation of existing plants scared these producers away and hence most of the new projects were shelved or abandoned. It is expected that there will be no new plants online in China in the future, and the capacity will be unchanged. In this case, producers should accelerate R&D of new technologies - catalytic technology in particular, reduce production costs, and improve operating rates of plants and product quality.

   The majority of polyisoprene rubber is rare-earth grade. It is less competitive for the serious homogenization. Meanwhile, high-end products still rely on import. To break the ice, producers should upgrade technologies to expand capacity, and improve the performance of polyisoprene rubber to explore application fields. In this way, they can cover domestic demand someday without relying on imports.