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How do people in the industry view the rise in rubber prices? Recently, reporters conducted questionnaire surveys through the website and WeChat at the same time.
Truck tires
Restricted exports of major rubber producing countries
In the past two years, natural rubber prices have been declining all the way. At the beginning of this year, it fell to the lowest point since the financial crisis. This caused the vigilance of the main rubber producing country.
In order to protect the interests of its own country, in March 2016, Thailand, Malaysia, and Indonesia jointly reached an agreement to reduce the export volume of natural rubber in order to stimulate market sales and stabilize prices.
The natural rubber production of these three countries accounts for more than 60% of the total rubber production in the world. Its limiting effect quickly spread to the entire rubber industry chain.
In the survey, 33% of the respondents believed that the main producing country restricted exports, and the use of rubber such as downstream tires and rubber products did not decrease, which directly led to a sharp rise in rubber prices.
Another 23% of respondents believe that extreme weather is raging in Southeast Asia, resulting in a certain decline in rubber production in several major producing countries, which indirectly affects the price of rubber.
Twenty-six percent of respondents believe that the increase in demand for rubber by tire companies stimulates higher rubber prices.
Plastic price is uncertain
As the world's largest natural rubber demanding country, China consumes more than 4 million tons a year, while domestic rubber production is only 700,000-800,000 tons, and the foreign dependence is over 80%.
Driven by favorable policies, industry insiders predict that China's total automobile production and sales will increase steadily this year.
Globally, the economy is still facing greater challenges, but the drop in oil prices has reduced the cost of vehicles and stimulated demand for cars. In addition, the rapid development of new energy vehicles has brought new impetus to the domestic automotive market.
The judgement of Indonesia's rubber industry is that the rising price of rubber prices can only be maintained until the first quarter of 2017.
One of the reasons they gave was that after Donald Trump was elected as president of the United States, the global economic situation became uncertain.
The reporter’s findings also seem to confirm this view. Forty-three percent of the respondents believe that the reasons for the rise in rubber prices are complex and the market situation is changing rapidly. It is not easy to say when the price of rubber can rise.
Only 17% of respondents expect that the price of rubber will continue for one or two years.
The respondents who believe that the price of plastics will continue for half a year and more than two months account for 22% and 18%, respectively.
Tire production costs increase significantly
This reporter learned that, in addition to rubber, carbon black, steel cord and other tire raw material prices are rising.
As raw material prices continue to rise, the cost pressure on tire companies has suddenly increased, and its slim profit margin has repeatedly been squeezed.
In a survey of industry insiders and major distributors by reporters, 45% of respondents stated that tire companies should improve their added value through transformation and upgrading, thereby reducing their dependence on raw materials.
39% of people in the industry agree with the price increase. This shows that domestic tire companies have recently raised prices of their products and have a direct relationship with rising raw material prices.
The price of natural rubber soared. Someone thought of another way. 16% of respondents said that the use of synthetic rubber in large quantities is also a good choice.
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