Degussa sets up rubber silanes JV in China

Düsseldorf, Germany-German chemicals group Degussa AG has signed an agreement with Rizhao Lanxing Chemical Industry Co. Ltd, based in Lanshan-Rizhao, Shandong Province, People's Republic of China, to form a joint venture to make sulphur-functional silanes for rubber applications.

Degussa will own 50 percent of the venture, and Lanxing 40 percent, with a financial investor owning the rest. This agreement follows a memorandum of understanding signed by the two companies in July 2005. The venture awaits approval by various authorities, and licenses from the Chinese government.

The new company, called Degussa Lanxing (Rizhao) Chemical Industrial Co. Ltd, will produce sulphur-functional silanes in liquid form and as a blend with carbon black.

Demand for high-quality rubber silanes is growing, not least because they produce tyres with lower fuel consumption, which are in demand because of current high fuel prices, Degussa pointed out.

Robert Wissner, head of Degussa's Advanced Fillers & Pigments Business Unit, explained the company's commitment to China in a company statement: By building a production plant in Asia we are supplementing our production facilities in Europe and the US, and further expanding our position as world market leader. Our joint venture facility in China will produce for our customers from the rubber and tire industries in Asia/Pacific who need our silanes to manufacture products that meet international standards."

Degussa calls itself "the worldwide leading manufacturer of silanes for rubber applications." Lanxing, set up in 1998, is a well-established local manufacturer in the Chinese market.

Degussa said that sulphur-functional silanes, in conjunction with silica, are used to make high-quality rubber compounds for tyres, technical rubber articles, and sports shoes. In tyres, the silica/silane system-which Degussa clains to have pioneered- "allows a significant reduction in rolling resistance and therefore a reduction in fuel consumption."