XUANCHENG, China—Non-tire rubber producer Zhongding is planning to build a $23.5 million specialty rubber mixing center, according to its stock exchange filing.
Located at the company's existing site in Xuancheng's Ningguo Economic and Technological Development Zone, the facility will have a 6,700 metric ton per year capacity for a series of specialty rubber such as ACM, fluorubber, ECO, HNBR, CSM and silicone rubber.
Zhongding has been rolling out high-end rubber products which raises its demand for specialty rubber, the filing read. The new facility will supply to Zhongding's own production lines.
Covering an area of about 54,000 square feet, the new project is expected to take 24 months to finish and create 50 new jobs. It is predicted to generate $8.23 million net profit annually on $65 million revenue when in operation.
According to the filing, last year China's rubber and plastics sector saw a 5 percent year-on-year rise in revenue to $486 billion. Profit increased by 7 percent to $30.5 billion.
More than 70 percent of global rubber consumption is used in the automotive industry, of which 40 percent are non-tire products, the filing added. The trends for vehicles to become smaller, faster and more comfortable as well as the tightening environmental regulations are making specialty rubber increasingly popular.
"We expect [China's] rubber sector to continue its steady growth and the automotive industry's rapid development will sure lead the progress in related sectors," the filing read.