Rubber Market Overview Bill Hyde Director C 4 Olefins and Elastomers Bill Hyde Director C 4 Olefins and Elastomers Chicago Rubber Group September 23, 2010 SingaporeSingaporeShanghaiShanghaiHoustonHouston New York LondonLondonDüsseldorfDüsseldorfDubaiDubai BangkokBangkok

September 2010 CommercialStrategyTransactionLegal Olefins & Derivatives Polymers & Plastics Methanol Aromatics Chlor-alkali & Vinyl Fibers & Intermediates Engineering Resins C 4 s and Elastomers Other Intermediates & Specialty Chems Project Economics Asset Valuations Technical Analysis Due Diligence M&A CMAI’s Global Consulting Business Business Advisory Services Market/Planning Advisory Services Corporate & Business Planning Support Market, Value Chain Competitive Analyses Feasibility Studies Legal Strategy, Expert Analysis & Testimony, Damage Assessment, Valuation & Arbitration Support Focused Multi-client Publications, World Analyses, Daily, Weekly, Monthly Services, Training Corporate Strategies Business Unit Strategies Functional Strategies

Chicago Rubber Group CMAI Tire Raw Material Index

Chicago Rubber Group What’s Next? Fundamental Drivers Synthetic Rubber Natural Rubber

Chicago Rubber Group Fundamental Influences

Chicago Rubber Group

The Synthetic Rubber Future Asia is the dominant factor and China dominates Asia Market limits vary by region –Supply/Demand –Feedstock availability

Chicago Rubber Group Global Synthetic Rubber Market

Chicago Rubber Group Is There Enough Capacity?

Chicago Rubber Group China Dominates Asia

Chicago Rubber Group What is China’s Future?

Chicago Rubber Group North America is Underutilized

Chicago Rubber Group Cost Differentials Also Drive Prices Rubber raw material prices have been historically high, but regional differentials have been even worse Rubber producers in North America can expect more of the same

Chicago Rubber Group BASE PETROCHEMICALS

Chicago Rubber Group Surplus Ethylene Peaks In 2010

Chicago Rubber Group On-Purpose Propylene Production

Chicago Rubber Group Evolving Trends in U.S. Butadiene Feedstock Production 4

Chicago Rubber Group New Extraction Capacity

Chicago Rubber Group Average Demand

Chicago Rubber Group

Natural Rubber Demand is recovering Market balance tightening

Chicago Rubber Group Natural Rubber Demand in China

Chicago Rubber Group Natural Rubber Inventory

Chicago Rubber Group Conclusions Fundamentals –Stabilizing Synthetic Rubber –China will be biggest market driver –Cost differences will cause price differentials and North America will have the highest of both Natural Rubber –Tightening

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