Cutting Edge Companies: Kraton Polymers

From the Summer 2012 Edition of Values

For many of us, molecular chemistry elicits distant and unpleasant memories of ill-fitting safety goggles and classroom experiments gone awry. For the scientists and researchers at Houston-based Kraton Polymers (ticker: KRA), however, molecular chemistry is a powerful tool that drives discovery, innovation, and economic growth.

Kraton Polymers’ specific expertise is thermoplastic elastomers—a class of plastics that exhibit characteristics similar to natural rubber, including elasticity and durability. The applications for materials with these unique properties are innumerable; Kraton’s products can be found in everything from weather sealants to cell phones to surgical gloves. And because of the soft, flexible, and durable nature of Kraton’s line of elastomers, they can be used as cost effective alternatives to certain traditional materials such as natural rubber and polyvinyl chloride (PVC).

PVC is the third most common plastic produced today, and while generally considered safe for most applications, “soft” PVC requires certain plasticizer additives that have been found to leach into the environment in the form of volatile organic compounds. Moreover, once additives have been introduced, PVC becomes relatively difficult to recycle and environmentalists indicate that it cannot be safely incinerated. Due to these limitations, many health care and consumer product manufacturers are looking to PVC alternatives, including Kraton’s line of plasticizer-free and 100 percent recyclable elastomers. In fact, 17 percent of new car models manufactured globally now have PVC-free interiors, up from none five years ago.

For some applications, such as the asphalt used to build interstate highways and airport runways, the most important characteristic is durability. Here too, Kraton’s elastomers are put to work with amazing results. Modifying road asphalt with elastomers significantly increases resistance to cracking and rutting, while also allowing for a 20 to 40 percent reduction in pavement thickness. Lower raw material costs, increased durability, and ultimately lower maintenance costs: a win-win for cash strapped transportation departments and natural resource conservation efforts.

Despite its industry-leading market share, Kraton continues to innovate and discover new uses for its line of advanced materials, including elastomer-based membranes and high performance fabrics. From breathable outdoor apparel to advanced water filtration and dialysis, the uses for Kraton’s elastomers continue to grow. So the next time you feel the “soft” plastic on your earbuds, wonder whether your toothbrush is recyclable, or comment on your flight’s smooth landing, you can think about a Kraton Polymers chemist in Houston–safety goggles and all.

This information is for illustrative purposes only and should not be considered investment advice or a recommendation to buy or sell any particular security. It should not be assumed that investment in any or all of the securities listed will be profitable.