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August 23, 2006 02:00 AM

Tire demand fueling growth in precipitated silica

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    AMHERST, Mass. (Aug. 23) — The global market for precipitated silica, fueled by demand from the tire industry, will grow 4.7 percent a year over the coming decade, hitting 2.1 million metric tons by 2015, according to a new report by Notch Consulting Group.

    The report, "World Markets for Precipitated Silica 2006," forecasts market value for the chemicals, including sodium aluminum silicates, to reach about $2.5 billion in 2015, equivalent to $1.22 per kilogram.

    The chemicals industry consultancy predicted that rising demand from the tire industry would be a major driver behind overall growth for precipitated silica, continuing a trend of the past decade.

    This growth, Notch said, would be driven primarily by greater demand for highly dispersible silica in fuel efficient tires, winter tires and high-performance tires.

    "Growth will benefit from greater demand in the OE passenger tire sectors of the U.S. and Japan and in the replacement market overall," Notch said.

    According to the study, 31 percent of demand for precipitated silica in 2005 came from the tire sector; 27 percent from non-tire rubber; 11 percent from dentifrice; 11 percent from the combined food, agricultural feed, cosmetics and pharmaceuticals sector; 7 percent from paints; 5 percent from plastics; and 4 percent from paints, coatings and inks.

    The consultancy said the global precipitated silica industry was dominated by five leading suppliers — Degussa A.G. of Germany, Rhodia S.A. of France, U.S.-based PPG Industries Inc. and J.M. Huber Corp. (Huber Engineered Materials) and Tokuyama/OSC Group, a joint venture between Tokuyama Corp. of Japan and OSC Group of Taiwan.

    Together, these five companies control more than 75 percent of world capacity.

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