SEOUL -- Kumho Petrochemical, a leading synthetic rubber producer in South Korea, approved a preemptive investment of 256 billion won ($225 million) to cement its leadership in the global market for synthetic latex used mainly for health care and medical purposes. The company said aggressive investments are needed to cope with the rapidly growing demand for nitrile butadiene latex.
Nitrile butadiene (NB) latex shows excellent resistance to oil and chemicals, making it useful in manufacturing protective equipment such as gloves for industrial and use. A COVID-19 pandemic boosted demands for nitrile gloves.
Kumho Petrochemical said the investment to increase the production of nitrile butadiene latex (NB latex) was endorsed at a board meeting on June 22. "As the utilization and demand of NB latex are expected to increase, we will prepare for stable supply through preemptive expansion," said CEO Baek Jong-hoon.
Kumho Petrochemical is to expand its NB latex production capacity to 710,000 tons by the end of 2021. Afterward, the company would embark on the additional expansion of 240,000 tons to raise its total production capacity to 950,000 tons by the end of 2023. Additional investments would be considered after 2023.
Kumho Petrochemical has maintained a competitive edge with its "continuous" production technology, which has excellent cost competitiveness and can reliably mass-produce uniform quality products. The technology is advantageous for high tensile strength, the core of latex gloves.
Kumho's new investment came three weeks after Taekwang Industrial agreed to set up an acrylonitrile joint venture with LG Chem. Commercial production of the plant with an annual production capacity of 260,000 tons is to begin in 2024. Acrylonitrile is an important monomer for the manufacture of useful plastics and important copolymers, such as acrylonitrile butadiene styrene (ABS) or synthetic rubbers.
Through the joint venture, LG Chem, a chemical wing of LG Group, will able to secure a key raw material needed for the production of ABS and NB latex. LG Chem aims to produce more than one million tons of NB latex in 2025.
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