Cariflex opens $462m synthetic latex plant in Singapore, largest of its kind in the world
Cariflex, a major synthetic rubber latex producer, on May 14 opened a new plant on Jurong Island that is expected to double its global production capacity once fully ramped up.
The 6.1ha facility, launched after a US$355 million (S$462 million) investment by the company, will enable it to better serve its customers in South-east Asia.
The region accounts for over 75 per cent of its sales.
The new facility is Singapore’s first polyisoprene latex plant and also the world’s largest facility of its kind, Minister for Manpower and Second Minister for Trade and Industry Tan See Leng said at the opening ceremony.
Cariflex’s polyisoprene latex is a synthetic, water-based polymer latex primarily used in the production of surgical gloves and condoms.
“When fully ramped up, the plant will double Cariflex’s manufacturing capacity for this product,” Dr Tan said.
Cariflex said the facility has created about 80 new jobs, with the majority filled by Singaporeans. These jobs are spread across engineering, production, quality, supply chain and other manufacturing support functions.
Dr Tan said the 80 jobs created is considered a sizeable expansion by today’s standards, given that the manufacturing workforce has steadily shrunk with automation.
The firm is also looking to add approximately 40 jobs in the coming years, Cariflex chief executive Ryu Sang Woo told The Straits Times.
Synthetic rubber latex has been touted as an alternative to natural rubber latex as it can minimise allergic reactions in some people, especially medical professionals who wear surgical gloves for long hours, said Cariflex chief operating officer Philippe Henderson.
Mr Ryu said the Singapore plant is an addition to its existing plant in Brazil, enabling the firm to diversify its manufacturing operations across two continents amid trade tensions.
“We can supply our raw materials (to customers) without any disruption because we have two parts of manufacturing,” he said, adding that the company is securing raw material supplies through partnerships and long-term agreements in Asia.
Dr Henderson said the Covid-19 pandemic disrupted supply chains around the world. Having a plant in Singapore will help shorten delivery times to South-east Asia customers and build supply chain resiliency, he said.
On why the firm decided to base its plant on Jurong Island, Mr Ryu said the island offers an attractive ecosystem with ready infrastructure and many multinational chemical companies operating there. Companies there can learn from each other and Cariflex can source some of the skilled labour on Jurong Island, he added.
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ingapore’s thriving financial, innovation and logistics hubs, along with a highly skilled workforce and strong intellectual property protection, also made it an ideal base, said Mr Ryu.
When asked how the firm is mitigating the potential rise in costs from US tariffs, Dr Henderson said Cariflex does not supply directly to the US, so it sees less direct impact. Instead, it supplies mostly to South-east Asia customers, which then export the end products to markets like the US.
Mr Ryu noted that higher costs will eventually be transferred to end consumers and hopes the trade war can be eased as soon as possible, especially when the company’s products are used in many medical goods essential for saving lives.
Dr Tan said Cariflex is part of a broader group of speciality chemicals companies in Singapore, many of which offer high-value chemical products used in various end-applications.
Speciality chemicals is an increasingly important growth segment for Singapore and contributes to 20 per cent of the output in Singapore’s wider energy and chemicals sector, he said.
Dr Tan added: “Speciality chemical firms produce in smaller volumes to serve niche end-markets, but its products tend to be higher-value and less carbon-intensive than commodity chemicals, and are often born from years and years of research and innovation.
“Growing this segment will go a long way in diversifying our manufacturing sector, and in building an innovation-led economy that will benefit Singaporeans.”
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