Asahi Kasei gearing up to meet spike in SR demand

NUREMBERG, Germany—Asahi Kasei Corp. has geared up production to meet a major spike in demand for its synthetic rubber materials since the easing of COVID-19 restrictions last year, while also raising its focus on sustainability.

"Market demand was low in 2020 but recovery was noticeable from 2021," said Eshwaran Subramani, development engineer at the Japanese supplier of synthetic rubber—largely solution styrene butadiene rubber (SSBR).

However, because of restrictions, Asahi was unable to produce enough SSBR and did not have sufficient stocks in 2021, Subramani told European Rubber Journal in an interview at the DKT rubber expo, June 27-30 in Nuremberg.

Nevertheless, he said, Asahi Kasei had now returned to high utilization rates across its three production sites in Oita and Kawasaki, Japan and in Singapore.

"With all three plants running at 100-percent utilization rate, we have now overcome the (supply) problem and don't have any stocks shortage," said Subramani.

"For instance, Oita has a capacity to produce 60 (metric) kilotons per annum (60 ktpa) of mainly batch-type SSBR, which is one of our favorite grades on the market and the demand is growing," he said.

In response to higher demand, Asahi Kasei has carried out several expansion projects, including a recent debottlenecking program at its Singapore facilities.

The company raised production at Singapore from 100 ktpa to 130 ktpa last year while the Kawasaki plant has been upgraded to produce 165 ktpa of SSBR and other elastomers.

"So, we now have the maximum possible capacity we could offer," Subramani commented.

Asahi Kasei previously signaled its intention to build a synthetic rubber plant in Europe. However, Subramani said the plan was on hold due to uncertainties in the market.

"Since we last talked about the possibility of a new plant, COVID has happened and now there is a fear of big inflation," he said, which all has "led to discussions going into a passive mode.

"So now we have shifted our focus and, since 2020, have been more orientated towards sustainability, looking into ISCC (International Sustainability & Carbon Certification) feedstocks and bio-based raw materials," he continued.

Here, Asahi Kasei is procuring sustainable butadiene from sustainable naphtha from Shell and is aiming to produce sustainable SSBR in Singapore.

"This is of course a small amount, and the sustainable content we are receiving now is not enough to cover our entire production," Subramani said.

The company is also starting to explore possibilities for producing sustainable SSBR in Japan.

"A key issue here is customer feedback, which Asahi Kasei is now assessing.

"Some customers are okay with ISCC but feel more comfortable to have a 100-percent bio-sourced product rather than a mass balance product," Subramani said.

Furthermore, to be an ISCC certified producer, all Asahi Kasei Elastomer operations would need to be certified.

Asahi kasei expects to be ready to provide ISCC certified product in 2022-23.