The tyre industry faces growing pressure to reduce fossil-based inputs, prompting a shift towards bio-based materials as industrial alternatives. Once a niche research area, bio-based solutions are now entering mainstream engineering as manufacturers balance performance and sustainability. This shift is clear in next-generation fillers, with companies like UPM advancing lignin-based solutions from concept to commercial validation.

Florian Diehl, Director of Sales RFF at UPM Biochemicals GmbH, explained that the company positions its BioMotion renewable functional fillers (RFF) as a new material class that addresses sustainability while delivering measurable performance gains.

NEXT-GEN FILLERS

Functional fillers are not peripheral to tyre design; they are central. Typically accounting for nearly 30 percent of a tyre’s composition, materials such as carbon black and precipitated silica have defined performance characteristics for decades. Against this entrenched backdrop, UPM’s innovation is not incremental – it is structural. “This is not a one-to-one drop-in replacement for carbon black, but rather a new material class that sits somewhere between carbon black and silica, with some properties closer to carbon black and others closer to silica,” said Diehl.

This approach is intentional. Instead of matching legacy materials, UPM expands the formulation options for tyre engineers, though this adds complexity. “You cannot just take out carbon black and put in RFF without making adjustments, because while it can replace both carbon black and silica to some extent, it requires changes in the formulation and curing system,” Diehl added.

Adoption will require iterative, collaborative development between material suppliers and tyre manufacturers.

PROOF THROUGH PARTNERSHIP

The collaboration between UPM and Nokian Tyres marks a key milestone in applying material innovation. In June 2024, they introduced the Green Step Ligna concept tyre, the first to use UPM BioMotion RFF, a fully renewable, wood-based lignin material. In this tyre, all fossil-derived carbon black in the sidewalls has been replaced by the lignin-based filler.

The concept tyre demonstrates the practical viability of lignin-based material in tyres and sets a higher benchmark for environmental responsibility in the industry.

For UPM, this collaboration is a strategic turning point. It marks the company’s entry into global tyre markets with renewable functional fillers and supports scaling its biorefinery business through proven application value.

Diehl noted that such collaborations are essential for industrial validation.

“The Nokian Tyres case is the only one we can discuss publicly, but we are working with most major tyre companies behind the scenes, even though we are not allowed to disclose their names,” he said.

PERFORMANCE STILL DOMINATES

Despite the strong sustainability narrative, Diehl was unequivocal that performance remains the primary driver of adoption. “For example, Nokian Tyres reported that when they replaced virgin carbon black in the sidewall, they observed improved rolling resistance, which is a clear performance advantage,” he said. This is consistent with early test findings, which suggest that substituting traditional fillers with RFF can enhance efficiency while reducing environmental impact.

Rolling resistance is particularly critical in electric vehicles, where it directly influences battery range. “In inner liner applications, we have seen that it improves air impermeability, meaning the tyre retains air pressure better, which is another functional benefit,” Diehl noted.

UPM’s data confirms improved air retention and efficiency as key outcomes.

The material’s lower density also reduces weight. “Compared to carbon black and silica, our material has a lower density, so you need less material, which makes the final product lighter and further supports improvements in rolling resistance,” Diehl said.

LIGNIN: UNLOCKING AN UNDERUTILISED RESOURCE

The foundation of UPM’s innovation lies in lignin, a natural polymer that has historically been undervalued. “Lignin is the second most abundant natural polymer and is present in all plants, but in the paper industry, it is typically separated and burned as an energy source rather than being used as a material,” Diehl explained.

For UPM, this represented a strategic opportunity. “As a company with deep expertise in wood handling and wood chemistry, we decided to move from fibre-based applications to the molecular level and develop biochemicals,” he said.

Through proprietary processing, lignin is transformed into a rigid particulate filler with controlled surface properties. “We developed a process that converts lignin into a particulate material that behaves like a filler, with tunable surface area and without the typical polymer characteristics,” Diehl added.

This transition – from waste stream to high-performance material – illustrates the broader industrial shift towards biomass valorisation.

SCALING FROM CONCEPT TO INDUSTRY

While the concept tyre proves technical feasibility, scaling is the next critical step. “The material is just becoming commercially available, and manufacturers prefer to test it from the final production site rather than pilot batches, so the current limitation is availability while our Leuna Biorefinery is in its start-up phase,” Diehl explained.

UPM’s Leuna biorefinery is central to addressing this. “At our biorefinery in Leuna, we will produce a total of 220,000 tonnes of biochemicals, with renewable functional fillers representing a significant share,” he said.

The facility itself represents a substantial industrial commitment, with investment exceeding EUR 1 billion and designed to convert sustainably sourced hardwood into next-generation biochemicals.

Crucially, scalability is underpinned by feedstock availability. “Lignin is already available at industrial scale in pulp and paper mills, so if the market adopts our solution, we can scale production significantly,” Diehl added.

COMPLEMENTARY MATERIAL STRATEGY

The rise of recovered carbon black (rCB) adds complexity to sustainability efforts. UPM positions its material as complementary rather than competitive. “We see our solution as complementary, meaning tyre manufacturers can use recovered carbon black alongside our renewable functional fillers to replace fossil-based carbon black,” Diehl said.

He also challenged assumptions around cost. “There is a perception that recovered carbon black is cheaper, but in some European markets, we hear that it can even be more expensive than virgin carbon black,” he noted. This suggests future tyre compounds will likely blend recycled and renewable inputs, rather than rely on a single alternative.

MARKET STRATEGY: PREMIUM FIRST

UPM’s commercial approach follows a well-established pathway for advanced materials. “As with most new materials, we expect initial adoption in premium segments before it gradually expands into the mass market, although this transition will take time,” Diehl said.

Premium manufacturers are expected to lead this transition, with emerging global players likely to follow as they move up the value chain.

ELECTRIFICATION DRIVES CHANGE

The rise of electric vehicles introduces new performance constraints. “Electrification will have a clear impact on tyre design because vehicles are becoming heavier and have higher torque, which makes wear resistance more critical,” Diehl said.

UPM is already adapting. “With our current solutions, we would not yet fully meet all requirements in such applications, which is why we are already working on a second generation that can compete more effectively,” he added.

SUSTAINABILITY

UPM’s RFF is positioned as a 100 percent renewable, CO₂-negative solution (from cradle to gate, considering the biogenic carbon and purchasing 100 percent green electricity), contributing to reduced reliance on fossil-based materials. However, Diehl is candid about market realities. “A few years ago, sustainability was the dominant driver, but today the focus has shifted towards combining sustainability with performance,” he said. “The willingness to pay higher prices is currently limited, which is a challenge, even though we believe our material delivers additional value,” he added.

REGULATION NOT ENOUGH

“There are discussions around end-of-life tyre regulations that could include bio-based quotas, which would support solutions like ours,” Diehl said. Yet he remains cautious. “Ultimately, the product must deliver performance, because regulations can change and cannot be relied upon as the only factor,” he added.

“We designed our processes so that the material can be handled and dispersed in a similar way to traditional carbon black and silica,” Diehl said. “When tyres containing our material are recycled, the filler will end up in pyrolysis oil, similar to natural rubber,” he added.

MEASURED TRANSFORMATION

UPM’s strategy focuses on systematic integration: introducing a new material class, validating it through partnerships and scaling it through industrial infrastructure. The Nokian Tyres concept tyre offers a tangible glimpse of what that future may look like: a tyre in which fossil-derived fillers are partially or fully replaced by renewable alternatives, without compromising performance. As Diehl concluded, “we are convinced the product delivers the performance and provides additional value, and will succeed in the market.”

The Government of Kerala has approved the twelfth phase of the Rubber Production Incentive Scheme, extending support to natural rubber growers through a guaranteed price mechanism.

The scheme is designed to ensure a price of INR 250 per kilogram for RSS 4 grade sheet rubber. Growers who are not yet enrolled may register for the programme until 23 October 2026, according to an official statement issued on 6 August in Kottayam.

Applicants seeking new registration must submit an Aadhaar card, bank passbook copy, current year land tax receipt and a photograph to their respective Rubber Producers’ Societies. Existing participants are required to renew their registration by providing land tax receipts for the 2026–27 period.

The release added that sale invoices or purchase bills submitted under the scheme must originate from licensed dealers who comply with statutory return requirements. Further details are available through the nearest Rubber Board office.

The Rubber Board of India has launched a series of educational videos as part of the iSPEED (INROAD Skilling and Production Efficiency Enhancement Drive) programme, an INR 1.50-billion initiative aimed at enhancing skill development, quality improvement and infrastructure building within the natural rubber sector. This launch comes as the plantation activities under the larger Project INROAD (Indian Natural Rubber Operations for Assisted Development) in Northeast India approach completion, shifting focus towards productivity and quality enhancement through modern training and facilities.

The newly released video series targets nearly 300,000 rubber growers in the region, covering five essential processing areas: Rubber Tapping, Rain Guarding, Grading, Rubber Sheet Making and Scientific Smokehouses. To ensure broad accessibility, the modules have been produced in Assamese, Bengali, Hindi and Malayalam, enabling effective communication with diverse stakeholders across the natural rubber ecosystem.

The official release of the videos was conducted by Executive Director M Vasanthagesan, alongside Rubber Production Commissioner Dr Siju T Nair, other senior Board officials and representatives from the Indian tyre industry. Developed over the past year with technical assistance from the Rubber Board and the Rubber Research Institute of India, the educational content combines animation with real-life field demonstrations to simplify complex scientific practices for easy adoption.

Project INROAD represents a unique collaboration between the Indian tyre industry and the Rubber Board, with support from Apollo Tyres, CEAT, JK Tyre and MRF. Over the last five years, this partnership has facilitated new rubber plantations across approximately 180,000 hectares in 113 districts of Northeast India, establishing it as the country’s largest plantation development programme of its kind.

Mohan Kurian, Chairman, INROAD Project, said, "Skill development and adoption of scientific practices are essential for improving both productivity and quality in the natural rubber sector. These multilingual videos will serve as an effective training resource for growers and complement the Rubber Board's ongoing extension efforts across the country.”

Sanjiv Saxena, Convener, ATMA Supply Chain & Resources (SCR) Group, said, "The objective of the participating member companies under INROAD is to ensure that rubber growers benefit the most from a stronger natural rubber value chain. By improving productivity and quality, we aim to help farmers realise better returns while strengthening the sustainability of the entire ecosystem."

Muraligopal, who played a key role in coordinating the development of the videos, said, "These videos are the result of close collaboration with the Rubber Board, RRII and field teams across the Northeast. Their guidance and support helped us develop practical, farmer-friendly training modules based on scientific best practices."

Zeon Corporation has finalised the construction of a new bench-scale facility at its Tokuyama Plant in Shunan City, Yamaguchi Prefecture, dedicated to advancing the efficient production of butadiene from sustainable ethanol sources. The project, which broke ground in July 2025, represents a strategic move to establish a naphtha-independent raw material supply chain, thereby bolstering both corporate sustainability and the broader transition towards a carbon-neutral society. The facility is slated to commence full-scale operations in January 2027, with the ultimate goal of achieving commercial viability by 2034.

A commemorative ceremony took place at the plant site on 31 July 2026, drawing a total of 46 attendees. The gathering included official representatives from Japan’s Ministry of Economy, Trade and Industry (METI), the New Energy and Industrial Technology Development Organization (NEDO) and local governmental bodies from Yamaguchi Prefecture and Shunan City. Also present were delegates from the Yokohama Rubber Company, the construction contractor and various affiliated firms, alongside Zeon’s leadership, including Akira Honma, the Corporate Officer and Tokuyama Plant Manager.

This initiative forms one half of a dual-themed research and development programme undertaken in partnership with Yokohama Rubber, under the auspices of NEDO’s Green Innovation Fund. The collaborative effort is focused on the social implementation of technologies for synthesising both butadiene and isoprene from renewable biological materials by the 2030s. As part of this process, Zeon is set to produce a prototype polybutadiene rubber using the output from the new bench-scale facility, while Yokohama Rubber will subsequently manufacture test tyres from this material and conduct performance evaluations on test tracks.

Both companies have outlined a clear roadmap, intending to finalise the core technology for societal deployment by 2030 through the operation of a larger pilot plant, with full-scale commercialisation targeted for 2034. The bench-scale facility is a critical precursor in this phased approach, providing essential data for the scale-up process.

The broader project encompasses two selected NEDO themes, both subsidised through the Green Innovation Fund. The first involves the highly efficient synthesis of butadiene from ethanol, with technical cooperation from the National Institute of Advanced Industrial Science and Technology. The second focuses on biotechnological pathways to directly produce butadiene and isoprene from plant-based materials, involving partnerships with the Institute of Science Tokyo and RIKEN. Both tracks aim to supplement synthetic rubber feedstocks and support closed-loop recycling, aligning with Japan’s 2050 net-zero emissions goal by fostering long-term industrial innovation.

The Association of Natural Rubber Producing Countries (ANRPC) has released its Monthly Natural Rubber Statistical Report for June 2026, a month defined by price resilience amid conflicting market forces. The provisional reopening of the Strait of Hormuz triggered a sharp 20.29 percent drop in Brent crude oil prices to USD 85.40 per barrel. However, this bearish signal was counterbalanced by persistent supply constraints from El Niño-related weather disruptions across major producing regions.

Physical rubber prices posted broad-based gains across most grades. SMR-20 rose 1.39 percent to USD 2.32 per kilogramme, while STR-20 gained 2.61 percent to USD 2.55 per kilogramme. RSS-3 and RSS-4 advanced 4.98 percent and 5.88 percent to USD 3.09 and USD 2.84 per kilogramme, respectively, though latex eased 1.44 percent to USD 1.94 per kilogramme. On the trade front, China's imports surged 7.14 percent month-on-month, while India and Viet Nam declined. Export growth was recorded for Cambodia, Viet Nam and Indonesia, though Thai shipments contracted.

Global production for 2026 is projected at 15.310 million tonnes, up 2.3 percent from 2025, driven by gains in Thailand, China, India and Malaysia. However, June output fell 3.7 percent year-on-year to 1.207 million tonnes due to seasonal wintering and El Niño-related weather disruptions. Malaysia, Indonesia and Cambodia have introduced new incentive and governance measures to strengthen their sectors. Global consumption is forecast to grow 0.7 percent to 15.411 million tonnes in 2026, with June consumption rising 3.3 percent to 1.300 million tonnes, led by China and India amid steady tyre and EV-related demand.

Currency markets saw the Malaysian ringgit trade between RM3.96 and RM4.08 against the US dollar, while the Thai baht ranged from 32.56 to 33.24. In futures trading, the SHFE September 2026 contract averaged 17,580.68 CNY per tonne, down 0.45 percent month-on-month, while the SGX September contract averaged USD 2.24 per kilogramme, up 1.75 percent, with both reflecting tightening supply and firm downstream demand.