Tight supply of rubber additives hard to ease shortly

China Rubber Industry Association has released statistics about the supply of China's rubber additive sector.

Environmental protection trend hit the sector

Statistics show that the 47 rubber additive producing members of CRIA produced 1.14 million tons of product, up 1.7% year on year, in 2017; and the sales revenue reached 21.57 billion yuan, up 15%.

It fully reflects tight supply and price hike features of the sector.

Impacted by environmental protection inspection last year, capacity utilization of the rubber additives sector plunged and resulted in short supply. Meanwhile, raw materials for producing rubber additives have also been affected, and the supply of some raw materials was even cut off.

Tight supply to continue

As the environmental protection policy no longer followed the principle of "one size fits all" since the final quarter last year, mainstream rubber additive producers resumed ordinary production gradually and the tight supply has been eased.

An industry insider says environmental protection is a long-term national policy and the technical standards for pollutant discharge will only become stricter.

Therefore, outstanding rubber additive producers have to increase environmental protection expenditure and follow the policy to ensure better condition of existence.

The greatest challenge for the rubber additive sector in 2018 is still environmental protection.

Under such circumstance, it will take longer time for producers to increase capacity, and tight supply wont' be eased in the short term.

Accordingly, rubber additive price still has room to ascend.