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SDK to Raise Polychloroprene Synthetic Rubber Price Again

November 4, 2004

Showa Denko K.K. (SDK) will soon start discussions with its customers in an effort to revise the polychloroprene synthetic rubber price for the second time this year.

The price of butadiene, the main raw material for polychloroprene, rose 40% during the period from March 2002 to March 2004, reflecting the tight demand-supply situation in the world. The rate of increase was substantial as compared with the 25% increase in the naphtha price in the same period. SDK therefore proposed, in the spring of this year, to revise the price of its polychloroprene product and, after a series of discussions with customers, obtained their consent.

However, the butadiene price continued to soar. The October 2004 price for butadiene was more than 40% higher than the price in March 2004 and more than 90% higher than the price in March 2002. SDK has been working hard to reduce production costs to cope with the situation, but the price increase is so rapid that it has become impossible for SDK to fully absorb the increase by its own efforts. Thus, SDK has concluded that it has no choice but to ask its customers again to bear part of the increase.

As a means to secure butadiene feedstock and ensure stable supply of the product to customers, SDK will raise the selling price by $300/MT starting with deliveries on and after November 22, 2004.

For further information, contact:
Specialty Polymers Dept., Specialty Chemicals Div. (Phone: 81-44-329-0728)