AS demand increases for energy efficient 'green tyres', Asia's No 1 S-SBR synthetic rubber maker Asahi Kasei is riding the wave by opening its second plant on Jurong Island. Estimated to cost 20-30 billion yen (S$307-460 million), it is slated for completion by the first half of 2015.
It will produce solution-polymerised styrene-butadiene rubber (S-SBR), a synthetic rubber used in car tyres to maximise fuel efficiency.
Increasing environmental awareness coupled with fears of a new oil shock has led to a recent surge in demand for 'green' tyres, said Asahi Kasei.
Demand for S-SBR, which enables the production of tyres that provide greater fuel efficiency while enhancing safety performance, is therefore growing briskly.
The company estimates that world demand for S-SBR used in fuel-efficient tyres will reach 500,000 tonnes this year, with a projected increase to 1.1 million tonnes by 2020.
Operated by Asahi Kasei Synthetic Rubber Singapore, a wholly owned subsidiary of Asahi Kasei Chemicals Corporation, the S-SBR plant will be the second plant that Asahi Kasei has on Jurong Island.
In a speech delivered during the groundbreaking ceremony, Asahi Kasei president Taketsugu Fujiwara highlighted the strategic positioning of the S-SBR plant in Singapore.
'Singapore is a great place for international business. It has excellent infrastructure. It has free trade agreements with many countries. There is a highly skilled workforce. The government is very understanding and supportive of business. And there is an excellent supply chain system operated by outstanding companies.'
At full operational capacity, the new S-SBR plant is expected to produce 100,000 tonnes of the synthetic rubber per year.
Asahi Kasei estimates that sales generated from the Jurong Island plant will account for 5 per cent of total revenue for Asahi Kasei Chemicals.