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Report Says Yokohama Considering Rubber Processing Role

(Akron/Tire Review) A senior official with Yokohama Rubber Co. told Dow Jones Newswires that the company is looking to take on its own natural rubber processing in an effort to curb raw material costs and assure supply of natural rubber.

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According to Keiichi Sekiya, general manager of corporate purchasing and strategic sourcing, the move is one of “several highly confidential strategies” the company is considering. "We want to be closer to the (rubber) plantation people," Sekiya said. "It doesn’t mean we want to get into the plantation business."

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Sekiya admitted that owning and operating its own rubber plantation probably isn’t in the cards for Yokohama due to the cost, but developing closer ties to existing plantation owners and latex processors – or even becoming a processor itself – could help cut costs.

The tiremaker would take more of an R&D approach, working with plantations on ways to improve product and processes with an eye to better natural rubber and lower processing costs.

Yokohama is currently “borrowing several processing lines from an unnamed Thai company,” the report said, and began considering its approach to the natural rubber processing industry some three years ago. "We have already borrowed some lines,” Sekiya told Dow Jones. “So we can know this cost structure. So, in the end we can find out how to get into the industry.”

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Goodyear recently announced that it had improved its ability to substitute synthetic rubber for natural rubber in tire manufacturing, by up to 15%. Natural rubber, which has undergone massive price increases over the past few years, is now 50% more expensive than synthetic rubber.

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