Tire price hard to stop rising

Many tire producers in China declared to raise prices since the end of Feb.

Most of their explanations for price hike are higher raw materials and shrinking profit margin.

Producers with better profitability, such as Linglong Tire, are also among those that have raised prices, implying that higher raw material prices have indeed impacted the tire sector.

At the same time, most tire producers lifting prices are comparatively small.

An industry insider analyses that most small- and medium-sized tire enterprises in China follow the route of small profits, quick turnover, and low price competition. Their competitive advantage may lose after frequent price lifting.

The world's major natural rubber exporters all seek maintaining or further increasing rubber price.

The capacity utilization of primary raw materials of tire, namely carbon black, rubber additives, framework materials, have been limited due to strict environmental protection regulations.

In addition, suppliers of the enterprises also lift prices.

Therefore, it is hard to predict when tire price will stop rising.