1. Market Dynamics

The Association of Natural Rubber Producing Countries (ANRPC) stated that the global natural rubber market is undergoing consolidation with a persistent supply-demand gap. Although dollar-denominated rubber prices saw a slight decline due to the strengthening Thai baht, robust domestic price support in Thailand suggests the current consolidation phase may serve as a springboard for the next price surge.

A survey by the UK Chemicals Industry Association revealed that 96% of chemical-related enterprises in the country perceive unclear industry planning, with 80% reporting negative impacts from government decisions. The industry warns that without countermeasures, this could trigger industrial relocation, thereby undermining the UK's industrial base and supply chain resilience.

On January 27, the India-EU Free Trade Agreement was formally concluded. The agreement provides preferential access for 99% of India's export goods, with rubber, plastics, and chemicals being core beneficiary sectors. Within the chemicals sector, 97.5% of export products (by value) will enjoy zero-tariff treatment.

2. Industry Data

In 2025, new car registrations in the EU increased by 1.8% year-on-year to 10.82 million units, yet remained significantly below pre-pandemic levels. Within the market segments, hybrid vehicles emerged as the top consumer choice with a 34.5% market share. Electric vehicles rose to 17.4%, while the combined share of gasoline and diesel vehicles dropped to 35.5%, a substantial decline from 45.2% in 2024.

3. Investment and Production

Circtec completed and launched the first phase of Europe's largest waste tire pyrolysis plant in the Netherlands, with an annual processing capacity of 50,000 tons. The second phase is scheduled to commence this year, bringing total capacity to 200,000 tons upon completion.

Toyo Tire partnered with HF Group to establish an innovation center at the Ingia plant in Serbia. Spanning 6,000 square meters, HF Group will oversee the design, supply, and installation of the R&D production line, providing advanced compounding technology to drive innovation in high-performance energy-efficient tire formulations. The center is expected to commence operations in 2027.

Reka Rubber announced plans to establish a wholly-owned subsidiary in Ukraine to advance its long-term growth strategy. The company is currently evaluating suitable properties and will make a final investment decision shortly.

Solvay inaugurated Europe's first bio-circular silica plant in Italy. Utilizing rice husk ash as feedstock, the facility produces highly dispersible silica for tires, achieving a 35% carbon reduction per ton of product. Continental Tire has explicitly stated it will increase application of this material, highly recognizing its performance.

Asahi Kasei, Mitsui Chemicals, and Mitsubishi Chemical have signed an agreement to consolidate ethylene production capacity in western Japan by FY2030. This involves closing the Mizushima plant and concentrating capacity at the Senboku plant, reducing total annual capacity from 951,000 tons to 455,000 tons. Concurrently, the three parties will invest in constructing an olefin plant based on bioethanol, expected to commence operations in 2034.

4. Corporate Updates

Nexen Tire achieved record sales of KRW 3.2 trillion in 2025, though operating profit slightly decreased by 1.1% to KRW 170 billion. To address trade uncertainties, the company is actively adjusting its strategy through European capacity expansion, diversifying distribution channels, and promoting large-size tires.

Trelleborg Group's full-year 2025 earnings (EBITA) rose slightly by 2% to SEK 6.3 billion. The group plans to invest in new factories in India, the U.S., and Morocco in 2026 to strengthen its long-term growth platform.

Kumho Tire signed a memorandum of understanding with South Korea's Lotte Innovation to jointly develop smart tire technology for autonomous vehicles. Kumho will supply tires compatible with electric vehicles and intelligent systems for real-time monitoring of tire pressure, temperature, and other conditions.

Parker Hannifin reported second-quarter fiscal 2026 sales of $5.2 billion, a 9% year-over-year increase. Driven by strong aerospace demand, the company raised its full-year sales and margin forecasts.

Bekaert has reached an agreement with Bridgestone to acquire Bridgestone's tire reinforcement business in China and Thailand for €60 million. This business generates annual sales of approximately €80 million. The parties have signed a long-term supply agreement, with the transaction expected to close in the first half of 2026.

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