SIBUR undergoing business transformation to focus on Russian market

MOSCOW, RUSSIA - Media OutReach Newswire - 22 March 2024 - In order to further develop industries that consume polypropylene, polyethylene and synthetic rubbers, SIBUR plans to transform its business management model starting in April 2024, transitioning from a structure focused on product divisions to an industry-based model.

To replace its Basic Polymers, Plastics and Organic Synthesis, and Synthetic Rubbers divisions, the company is going to create the following industry-based divisions instead:

• Agribusiness
• Recycling
• Flexible Packaging
• Rigid Packaging
• Engineering and Transport Infrastructure
• Healthcare
• Oil and Gas Processing and Production
• Consumer Goods
• Construction
• Transport
• E-commerce and Partnerships

SIBUR's primary goal is to satisfy demand from Russian customers that are meeting the needs of socially important industries. The company has been consistently building up its capacities since 2014, more than doubling its production of core products in that time. Thanks to an intense R&D effort to develop its product line, SIBUR has been bringing innovative products to market every year to replace alternative solutions that are less eco-friendly and less energy-efficient, as well as to replace imports and to expand niches for the use of tried-and-tested products. These initiatives have enabled the company to facilitate growth in local production in various industries. In 2023 alone, SIBUR launched 27 new grades of petrochemical products with potential for sales of 111 thousand tonnes per year. Over the past 10 years, the consumption of polypropylene and polyethylene has increased by 35%. Thanks to SIBUR's efforts to boost demand for polymers and its customer support programmes, imports of polymers as well as finished products made from polymers have been consistently declining. Imports of polymers into the Russian Federation have decreased by more than 30% since 2014.

The gradual ramp-up to design capacity at the Amur Gas Chemical Complex and a new polypropylene production facility in Tobolsk (DGP-2), which is expected to begin operating in the next few years, will help further increase polymer consumption in Russia and facilitate the development of import substitution programmes for finished products made from the latest synthetic materials.

SIBUR's vision is to support the comprehensive development of every petrochemical-consuming industry, to meet growing demand and to promote the use of high-tech materials.

Russia has excellent potential when it comes to developing the use of polymer products. For example, polymers are used in 37% of packaging in the Russian Federation, while this figure reaches 50% on average in other countries. The use of polymer solutions in the housing and utilities sector in the Russian Federation is no higher than 40%; this figure is 85% in Europe. At the same time, per capita consumption of polymers in developed countries, such as Turkey (52 kg per capita), is ahead of consumption in the Russian Federation (30 kg per capita).

The transition to an industry-based model will expand opportunities for Russian manufacturers to sell their products by encouraging the use of domestic solutions, finding new niches for their use and.

Over the past 10 years, SIBUR has carried out an array of projects aimed at developing a customer-oriented business model. It has a well-developed network of R&D centres that enable it to quickly find solutions in response to customer requests for support in launching new products and formulas. SIBUR's new model will enable its customers to work alongside the company to test ideas and hypotheses for the development of product lines and applications.

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