The nation’s leading chemical and battery firm LG Chem is set to triple its elastomer output to meet the growing demand in the global market, the company said on Monday.

LG Chem said it would invest 400 billion won ($351 million) to build additional factories, which will be capable of producing 200,000 metric tons of elastomers on an annual basis. Elastomer is high-valued synthetic resins, which is used for materials for cars, shoes, functional films and electric wire. 


When the plants are completed, LG Chem’s production capacity for elastomer will increase threefold from the current 90,000 tons to become the world’s third largest producer, followed by two American firms, Dow Chemical Company and Exxon Mobil.

The local chemical firm said with the output rise, it is seeking to expand its logistics base into Europe and North America beyond Asia to make inroads into the global markets based on customized demands.

“LG Chem plans to expand the business portfolio into high-valued products through investment and continued research and development,” said Son Ok-dong, the company‘s basic material business chief.

Elastomer is expected to grow further thanks to the rising demand on lightweight materials for cars. Petrochemical research firm Chemical Market Resources said the market would grow to 3.5 trillion won by 2020 from 2.4 trillion won last year.

Despite such high demand, the market has high entry barriers because the material requires high technologies. Currently, only four companies -- LG Chem, Dow Chemical, Exxon Mobil and Mitsui Chemicals -- are able to mass produce the material.

LG Chem, which has around 400 patents at home and abroad, won a patent suit against U.S.-based chemical giant Dow Chemical in 2012.

By Shin Ji-hye (shinjh@heraldcorp.com)