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END of 2017 SHORT MARKET REPORT

In 2017, the profits of the domestic tire industry fell sharply. As the cost of raw materials was raised, some tire companies began to raise their prices. Sales of tires are shrinking in the weak season, It is difficult to carry out the actual implementation of the price increase. The price advantage of domestic tires in European and American markets is weakened, The growth of export volume is restrained.

Heavy stock pressure is one of the main factors restricting the rise of natural rubber for a long time. As of January 2nd, The total rubber stock of the Qingdao Free Trade Zone continued to accumulate to 235 thousand and 600 tons, Of which 130 thousand and 800 tons of natural rubber, The Shanghai futures exchange rubber registered warehouse receipt soared by more than 310 thousand tons, Or will break through 400 thousand tons again before the Spring Festival.

There is a great differentiation in the lower tire start rate, TBR tyres 61.03%, PCR tyres 65.98%. A reasonable explanation, Annual overhaul of individual TBR tyres companies, pull low average start rate, Some PCR enterprises based on the order situation, Small range increase production, Most tire companies have little fluctuation in production, Basic continue prophase level. Considered Manufacturers have a pre - stock demand before Spring festivel, Short term tire production will maintain the current state, After entering February, the factory began to enter into vacation, so It is at the beginning of the tire was first started after the steady decline trend.

Domestic tire industry profits fell sharply in 2017, A considerable number of enterprises are in a state of loss. The profit margin of the national tire enterprises is about 1.97%, Down 2.96% from the same year. According to the statistics of the China Rubber Industry Association for 38 member tire enterprises, The total profit of 2 billion 359 million yuan from Jan. to Oct., A 54.06% decrease over the same period last year, Profits have fallen by more than 50% year on year since April. 16 of these companies were losing money, Losses amounting to 1 billion 550 million yuan. While profits are reduced, the production and revenue of the tire enterprises are growing.


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