For decades, China has stood as the world’s dominant supplier of raw materials across industries, making it a significant player in the global supply chain. However, Gujarat-based Lead Reclaimed Rubber, an Indian MSME, has achieved a remarkable feat by exporting reclaimed rubber crumb to Chinese manufacturers. The company capitalised on India’s abundant scrap tyre supply and favourable policies, tapping into China’s massive demand for reclaimed rubber. As Lead Reclaimed Rubber continues to expand its production capacity and export markets, the company also faces challenges such as labour shortages, supply delays and regulatory concerns. Despite these obstacles, it remains optimistic about its growth prospects.

China has been the largest supplier of raw material for every industry known to man since decades. While there are many companies in different markets trying to sell back to China, an Indian MSME has unachieved the feat of selling to the ‘seller’.

Gujarat-based end-of-life tyre (ELT) recycler Lead Reclaimed Rubber has been exporting its reclaimed rubber crumb to Chinese manufactures. Commenting on how the company achieved this feat, Chief Executive Officer Jayeshh Patel told Tyre Trends in an exclusive interview, “China is the largest importer of reclaimed rubber, sourcing the material not only from India but also from countries like Vietnam and Sri Lanka. This demand is driven by a vast domestic market for tyres and inner tubes, with numerous brands operating in the aftermarket segment as well as in OEM manufacturing. As a result, the growth potential is significant.”

“While China has its own reclaim rubber plants, it faces limitations due to inadequate scrap tyre availability. In contrast, India has an abundant supply of scrap tyres supported by both domestic generation and strong import volumes. Additionally, India’s favourable government policies and the availability of skilled labour further enhance its position as a competitive and reliable supplier of reclaimed rubber to China. Hence, our company capitalised on the situation and started exporting,” he added.

Lead Reclaim Rubber was established in 2012 and is an NSE-listed company. It operates both in domestic and export markets with plans to grow its current production capacity as the reclaimed rubber market unfolds its potential.

Moreover, Patel noted that the Extended Producer Responsibility (EPR) framework by the Indian Government is playing a crucial role for the recycling industry for reaching greater heights.

EPR IMPACT

According to Patel, EPR has emerged as a transformative force in the recycling industry. Given the industry’s dynamic nature and its drive to adopt advanced technologies, EPR presents a timely and impactful mechanism to support growth particularly for micro, small and medium enterprises (MSMEs).

“While the recycling sector is evolving, recyclers often operate on thin profit margins, which limits investment in new technologies and process upgrades. EPR has helped bridge this gap. Under the scheme, we are awarded green credits for every kilogramme of end-of-life tyres we recycle. These credits are a compliance requirement for tyre manufacturers, who purchase them from registered recyclers like us. For every 100 kilogrammes of tyre recycled, we receive approximately 130 green credits, each valued at INR 2.5, resulting in a direct financial incentive. This additional income strengthens our balance sheet and can be reinvested in research and development, capacity expansion and technology upgrades. In this way, EPR indirectly fosters innovation and scaling in the recycling ecosystem,” said Patel.

To maintain accountability and transparency, the Central Pollution Control Board (CPCB) has developed a digital portal where all stakeholders must report data.

“We record our incoming feedstock (purchase data) and outgoing materials (sales invoices) on the CPCB portal. This data forms the basis for calculating green credit eligibility. Our operations are routinely audited by both government agencies and the tyre industry. These audits verify that we meet all technical and environmental standards before credits are approved. The government has also established baseline electricity usage norms for tyre recycling. We are required to submit our electricity bills to demonstrate compliance. If our energy consumption does not meet the defined threshold, we are ineligible for green credits, preventing fraudulent claims,” he Patel.

He optimistically contented that EPR is rapidly becoming the backbone of the tyre recycling industry. For over a decade, recyclers have struggled with limited access to capital. EPR is now enabling financial stability, paving the way for recyclers to professionalise operations, scale sustainably and drive forward-looking initiatives. This policy is not just a support mechanism but a growth enabler.

AN OVERVIEW

The recycling company focuses on sustainable practices and high-quality output. “Our core operation involves sourcing EOL tyres and tubes from various states across India for recycling into value-added rubber products. Our recycling process begins with a proprietary feedstock checking system to ensure quality. The tyres are then sorted, cut and processed into crumb rubber powder. Currently, we produce crumb in 30–40 mesh sizes with plans to expand into finer 80 and 120 mesh grades in the near future,” explained Patel.

For the domestic industry, crumb rubber serves a wide range of applications. Finer meshes (80 and 120) are used in various rubber and dye industries, while 30–40 mesh is commonly used in bitumen modification for road construction, in line with the Central Government’s CRMB 30 guidelines.

Furthermore, the company employs a green devulcanisation system that utilises steam, oil and pressure to break down and re-bond the rubber polymers from EOL tyres. This method is 100 percent sustainable, producing zero discharge and zero wastage. Even the steam generated during the process is condensed and reused. “We are in the process of acquiring a Z-Certificate for our zero-waste operations,” divulged Patel.

Post-devulcanisation, the rubber material becomes soft and slightly sticky due to the restructured cross-linking. It then undergoes further processing in the reclaim section, which includes refiners, mixing mills and a cleaning stage.

During cleaning, all metallic and non-rubber impurities are extracted using strainers with 60-millimetre wire mesh. The purified compound is extruded into noodle form and sent to the refiners to produce the final reclaimed rubber product, typically in seed form.

“We tailor our reclaimed rubber to meet the specific requirements of our customers including thickness, size and performance properties. Each product is made to specification. The reclaimed rubber is used across various industries including tyre and tube manufacturing, conveyor belts, packaging and other rubber-based products. As industries increasingly shift from virgin to reclaimed rubber, we position ourselves as a reliable and environmentally responsible supplier,” noted Patel.

PRODUCTION AND SUPPLY

According to Patel, virgin rubber contains about 90–100 percent RSPL, while reclaimed rubber has around 50–52 percent. It’s more affordable than virgin rubber, but the use of 100 percent reclaimed rubber in tyre manufacturing is still a distant thought.

However, it’s widely used in rubber mats. Tyre manufacturers are gradually increasing reclaimed rubber usage, encouraged by government directives to reduce dependence on natural resources and imports. Since local virgin rubber production is insufficient, it’s being imported from countries like Vietnam.

Currently, large tyre manufacturers in India use only a small percentage of reclaimed rubber, around two to three parts per hundred

rubber (PHR). For cycle and three-wheeler tyres, it goes up to 20 PHR. Conveyor belts use up to 30 percent, and in non-critical applications with almost no performance impact, reclaimed rubber can be used up to 95 percent.

The company’s plant is located in Katlal, Kheda, near Ahmedabad, and it uses Indian machinery sourced from Punjab. “We started production at 250 metric tonnes per month. After Covid, we scaled up to 490 metric tonnes and recently reached 960 metric tonnes per month. Within the next year, we plan to expand further to 2,000 metric tonnes per month,” said Patel.

He added, “We run our plant with TBR tyres both nylon and radial. We’re centrally located in Ahmedabad and as Gujarat shares borders with Rajasthan, Madhya Pradesh, Maharashtra, and the southern states, it helps us with tyre sourcing. We collect tyres through a three-layer supply chain consisting puncture shops, rag pickers and aggregators. The aggregators sort the tyres as per our requirements.”

For nylon tyres, the company only uses the centre portion, specifically from 1020 tyres and discards the sidewalls. For radial tyres, it recycles the entire tyre. The recycling technology is the same for both, but the processing recipe differs. Radial tyres have cords in the centre, so the devulcanisation process is slightly modified to handle the added strength. Its research and development facility are located inside the plant.

Commenting on what sets the company apart from competitors, Patel explained, “Our focus on consistency and timely delivery sets us apart from competitors. We maintain a 95 percent consistency ratio. From raw material to the final product, everything is monitored and controlled by our control plant, which is also a key differentiator. We also have an in-house development department that not only ensures quality consistency but also works on improving the benefits for our customers. On top of that, we conduct awareness programmes to educate our customers on which materials are best suited for different use cases. That’s something others in the industry usually don’t do.”

MARKET SPREAD

Lead Reclaim Rubber serves both domestic and international markets. Among the industries it caters to, conveyor belts account for 30 percent of its business, tyres for 20 percent and the remainder comes from rubber products and packaging. Although the tyre and tube segments currently represent a smaller share of revenue, Patel anticipates significant growth in these areas. Over the next five years, it expects tyres and tubes to become its largest consumer segment followed by conveyor belts.

The company attributes this projected growth to the government’s strong emphasis on the circular economy and the rapid expansion of the automobile industry, both of which are likely to increase demand for reclaimed rubber.

The company exports to several countries including Sri Lanka, China, Bangladesh, Turkey and Philippines. China is currently the largest consumer in its export portfolio, followed by Sri Lanka. According to the Patel, export markets generally use more reclaimed rubber due to their larger production capacities.

The export market continues to show strong demand and the company currently has pending orders from China.

However, as European nations vie for restricted EOL tyre exports to India, the scenario for indigenous recyclers can be precarious. Commenting on the potential impact of such restriction, Patel highlighted, “India recycles a significant portion of the scrap tyres it generates. However, unregulated and illegal pyrolysis operations remain a critical concern. These units often operate without environmental compliance, posing risks to public health and the environment. Stronger government intervention and regulatory enforcement are urgently needed to eliminate such practices and ensure sustainable recycling.”

“India’s tyre recycling ecosystem is diverse and imbalanced. While there are numerous recyclers, the segment is dominated by pyrolysis players (approximately 70 percent), with reclaim rubber manufacturers constituting only around 30 percent. This heavy skew towards pyrolysis is problematic, especially since many of these players depend on imported scrap tyres for feedstock. If the import of scrap tyres into India is disrupted, it will create a significant supply shortage, driving up the price of ELTs. Currently, the price of scrap tyres ranges between INR 18–21 per kilogramme, but a halt in imports could potentially increase this to INR 40 per kilogramme, a nearly 50 percent spike, which would severely impact the entire recycling value chain,” cautioned Patel.

Besides this looming issue, Patel highlighted several pending challenges for the industry. One of the primary issues is a shortage of skilled labour. Interestingly, even as the industry moves towards greater automation, the demand for labour continues to rise.

Another challenge is supply delays caused by aggregators, who often fall behind on delivery timelines due to their own labour shortages. Additionally, maintaining quality consistency is difficult as scrap tyres vary in composition from batch to batch. As a result, the company must closely monitor and control its processes.

A significant concern affecting future growth is the regulatory environment. The company remains cautious about expanding production because of the current ban on scrap tyres.

Although the business is regulated, there’s an underlying fear that stricter government action could further limit the supply of scrap tyres. Such restrictions could leave newly built expansion units underutilised.

Patel believes that unless government policies become more supportive, major investments and expansions will remain risky.

Looking ahead, Lead Reclaim Rubber is planning both forward and backward integration. On the forward side, the company aims to start manufacturing rubber tiles made entirely from rubber granules, a by-product of its current process. It also plans to enter the cycle tyre industry.

As part of its backward integration strategy, the company intends to set up more tyre collection centres both internationally and within various Indian states to secure a more consistent supply chain.

Flexsys has created what it says is the tyre industry’s first practical and scalable alternative to 6PPD, marking a major step toward replacing a chemical used for decades but now under regulatory pressure.

The company said the new antidegradant is the result of several years of research and testing with federal laboratories, independent scientific groups and tyre makers. Early results show the material could match the performance and safety of 6PPD while avoiding the environmental risks linked to 6PPD-quinone, a transformation product identified in 2020.

Flexsys said the new chemistry provides the short- and long-term protection needed to stop tyres cracking or ageing. It is also designed to fit into existing rubber compounds with minimal changes, which could help manufacturers adopt it quickly. The company added that the product meets environmental and regulatory benchmarks, including criteria set by the Washington State Department of Ecology.

Importantly, the new molecule is not part of the “PPD” family, meaning it does not form quinone during use. Flexsys said this would remove the environmental impact associated with 6PPD-quinone. The company is also using many of the same intermediate chemicals already used in 6PPD production. This could allow manufacturers to rely on existing factory assets and speed the shift to the new technology.

“This achievement reflects our unwavering commitment to responsible innovation, built on decades of expertise in tire protection chemistry,” said Carl Brech, Chief Executive Officer of Flexsys. “Our solution is formulated to deliver the performance and reliability that tire makers expect and is designed for future environmental and regulatory standards.”

6PPD has been essential to tyre durability for 50 years. But studies published in 2020 showed that 6PPD-quinone could harm aquatic species, including coho salmon. Regulators and tyre producers have been looking for a safer option since then. Flexsys said its new antidegradant meets this challenge without reducing tyre safety.

“Our team set out to develop a next-generation antidegradant that meets the tire industry’s highest performance standards without compromising tire safety, while also reducing toxicity,” said Neil Smith, Chief Technology and Sustainability Officer. “I could not be more proud of the perseverance and dedication of the Flexsys R&D team. Our group has been highly motivated by both the technical challenges of this project as well as the positive societal impact that this work will ultimately have.”

Flexsys acknowledged support from the Sustainable Polymers Tech Hub in Akron, Ohio, part of the U.S. EDA Tech Hubs programme.

The company is now working on process optimisation to allow large-scale production. It is also in discussions with regulators around the world to secure approvals for commercial use. Testing with tyre makers is continuing.

“Flexsys is helping set the direction of the tire industry for the coming decades with this development,” Brech said. “We will continue to work tirelessly to bring this breakthrough to the market as soon as possible.”

Wacker Chemie AG has strengthened its position in China’s fast-growing market for silicone specialities by opening a new application development centre with joint-venture partner SICO Performance Material in the eastern city of Jining.

The 2,300-square-metre facility brings together several laboratories focused on organofunctional silanes, which are used as high-performance additives in plastics, coatings and adhesives. By locating the centre next to SICO’s production and scale-up lines, Wacker aims to shorten development cycles and move new products into the market more quickly. The companies said investment in the site is in the mid-six-figure euro range.

Tom Koini, who leads Wacker’s silicones division, said the opening marks an important step in its China strategy. “As a provider of innovative silicone specialties and solutions, we can use this development center to achieve a key milestone for our business in China. Our focus is on high-margin specialty silanes, for which demand in China is rising continuously. This investment together with our partner SICO strengthens our presence and commitment to the region,” he said.

Wacker, which took a majority stake in SICO in 2022, is seeking to build a larger share of China’s specialty chemicals market, where demand for hybrid polymers has increased for years. These materials help improve the mechanical and chemical properties of adhesives, sealants, coatings and engineered plastics, all of which are used in sectors such as electric mobility, electronics and power equipment.

At the opening ceremony, SICO General Manager Kevin Qu called the centre an investment in the long term. “We can now pool all of our silane expertise here at our application development centre. This know-how ranges from chemical product properties and supply chain matters through to questions of process engineering and current marketing trends. We will leverage this in-depth knowledge to develop forward-looking innovations for our customers. This marks a new chapter of success in the history of our joint venture,” he said.

The companies said the centre will act as a link between research, technical service and manufacturing teams. Scientists will focus on developing additives, adhesion promoters and stabilisers based on organofunctional silanes and functional silicone fluids.

The Association of Natural Rubber Producing Countries (ANRPC) has released its Monthly NR Statistical Report for October 2025, providing an overview of key developments in the global natural rubber sector.

According to the report, the global natural rubber market in October was characterised by a distinct bearish trend in pricing. This decline can primarily due to a significant surge in production and export activities, which were initially stimulated by the higher prices seen earlier in the year. Meanwhile, overall demand has remained relatively subdued.

Looking ahead to the full year, projections indicate a modest 1.3 percent increase in global production for 2025, a figure that follows a recent downward revision for Indonesia. On the demand side, consumption is anticipated to grow by a slight 0.8 percent, influenced by an upward adjustment to Indonesia's consumption data. Despite the current price pressures, market sentiment shows some mixed signs of improvement, particularly within the tyre trade of certain specific markets.

DuPont commenced construction on a new MOLYKOTE speciality lubricants production facility in Zhangjiagang, Jiangsu Province, East China, on 18 November 2025 with a groundbreaking ceremony that was attended by Senior DuPont leadership from the MOLYKOTE business and the Asia-Pacific region, alongside government officials and key customers. This strategic investment, situated within the Yangtze River International Chemical Industrial Park, is projected to be fully operational by the beginning of 2027. The initiative is a key component of the brand's global expansion, designed to significantly enhance its responsiveness to regional market needs and foster local innovation.

The new plant will primarily focus on meeting the robust and growing demand for advanced lubricant solutions across several critical sectors in China, including transportation, industrial manufacturing, energy and electronics. By establishing a local manufacturing presence, DuPont aims to create a dynamic platform for collaboration with regional customers. This will enable the company to deliver next-generation lubricants with greater speed, precision and agility, ultimately shortening lead times and strengthening supply chains.

The MOLYKOTE brand, with a legacy spanning over 75 years, is globally recognised for its expertise in solving complex lubrication challenges and improving energy efficiency. Its comprehensive product portfolio, which includes greases, oils, anti-friction coatings and pastes, serves the automotive and industrial maintenance, repair and overhaul markets worldwide. Supported by a global network of manufacturing and research facilities, the brand continues to build on its reputation for performance and reliability.

Eugenio Toccalino, Vice President and General Manager, DuPont MOLYKOTE, said, “Today’s groundbreaking is the beginning of a new chapter in our journey to better serve our customers in China, innovate faster and to be a partner of choice for solving wear and friction challenges across industries. This facility will boost local capabilities for application and new formulation development, empowering customer collaboration and response in real time.”

Yi Zhang, Global VP and Regional President, DuPont Asia Pacific, said, “We are thrilled to be breaking ground on the MOLYKOTE China production facility in Zhangjiagang. This manufacturing unit will enable us to address current needs and future trends for speciality lubricants. It reflects our confidence in the long-term potential of customers in China and Asia-Pacific region and reinforces our commitment to deliver faster, more resilient and locally tailored solutions.”