Dow Announces Plans to Construct New Solution Styrene Butadiene Rubber (SSBR) Plant in Europe

The Dow Chemical Company announced today that construction is underway for a new Solution Styrene Butadiene Rubber (SSBR) plant in Schkopau, Germany. Scheduled for completion in the second half of 2008, the world-scale facility will have production capacity of 60 KT (132 MM lbs). Dow is a leader in the production of SSBR, a key component used in the manufacture of high performance tires, as well as technical rubber goods. The new facility includes a capacity rights agreement with JSR Corporation, based in Japan. Dow will own and operate the new asset.

“The construction of our new facility underscores Dow’s commitment to advancing its Solution SBR technology for tire applications, particularly in the high performance segment where we offer our customers a differentiated product portfolio providing superior performance characteristics with respect to low rolling resistance, high grip and durability,” said Craig Arnold, global business director for Synthetic Rubber at Dow. “Market dynamics indicate continued healthy demand for SSBR, and as a leading producer in Europe, Dow is taking the necessary steps now to ensure its ability to meet customer needs well into to the future.”

SSBR is the fastest growing segment of the rubber market, with an anticipated annual growth rate of five to six percent over the next several years.

“Dow’s SSBR technology has realized tremendous market acceptance and has great potential to differentiated, functionalized products,” noted Arnold. “Investing in the SSBR business through the construction of our new facility further demonstrates Dow’s strategy to invest preferentially in its performance businesses that can sustain value for our stakeholders throughout the cycle.”

Dow is a leading manufacturer of synthetic rubber including SSBR, Styrene Butadiene Rubber (SBR) and Poly-Butadiene Rubber (PBR), with facilities also in Germany and France. Dow is back integrated into butadiene and styrene, the major raw material used in the production of SSBR, which enables the company to maintain a reliable supply with cost-advantaged economics.