Due to sluggish tire market demand, tire output in Shandong province dropped both on a yearly and a monthly basis in Apr..
Statistics released by Shandong Rubber Industry Association show that in Apr., the province’s tire output totaled 37.67 million, down 3.3% from Mar., or down 1.2% year on year.
The output of radial tires dropped 4.7% from Mar., or 2.7% year on year, to 29.59 million, accounting for 51.2% of China’s total radial tire output.
In the first four months of this year, Shandong province produced 144.40 million tires, up 7% year on year, accounting for 47% of China’s total.
The accumulative radial tire output grew 7.7% to 115.14 million, accounting for 50.1% of the country’s total.
In addition, Shandong’s motorcycle cover tire output in Apr. decreased 3.7% from Mar. to 3.34 million, up 9% year on year, accounting for 38.2% of the country’s total.
In the first four months, Shandong’s motorcycle cover tire output rose 5% year on year to 11.74 million, accounting for 35.4% of the country’s total.
In the first quarter, tire producers’ capacity utilization was higher than the same period of the past years as tire prices increased. Starting from Apr., tire sales turned down, with mounting inventories and sharp decrease in capacity utilization.
From end-Apr. to early-May, the capacity utilization of all-steel tire producers in Shandong was only 55.03%, down 11.41% month on month, or down 15.79% year on year.
The capacity utilization of semi-steel tire producers in the province was 41.12%, down 27% month on month, or down 32.9% year on year.
Currently, the distributors still focus on running down stocks, the price has fallen and the sales volume is smaller, the output in May may not able to rebound, said an analyst.
