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Why capacity utilization drops while tire price goes up?

Shandong tire makers lift tire price, but face all-steel tire capacity utilization drops.

China's all-steel tire market was even more volatile in July than in a year ago.

Capacity utilization drops on yr

The average monthly capacity utilization of all-steel tire producers in Shandong has been 59.96% so far, about 13.64 percentage points lower than the same period a year ago.

A number of producers planned to stop production in July.

The reasons are largely due to regional restriction on the use of electricity and line maintenance by power plants. Moreover, some producers try to ease capital pressure by leveraging discontinued maintenance.

A few producers raise price

Raw material prices started to grow since Jun. Some producers' raw material storages were insufficient and they were already been affected by fluctuation in prices.

A few tire producers announced in Jul. to adjust up tire prices.

Given the information above, price lifting hasn't become a tendency, most producers keep price stable and some of them even continue the promoting activities.

Jiang Yun, an industrial analyst, says the price lifting has little impact on the market, but is taken as tool for market speculation.