Economic indices of the rubber industry were unpleasant in 2015.
Industrial figures decline across the board
According to figures released by China Rubber Industry Association (CRIA), major economic indices of the rubber industry in 2015 were all negative. In the first 10 months of 2015, sales revenues of key members of CRIA dropped 10.85% year on year and their profits dropped 22.98% (excluding additives and frame materials producers).
The tire output tumbled since February 2015 and went all the way down. In the first 10 months, tire output declined 6.70%, while the output of radial tires decreased by 5.64%.
Figures released by the Customs show that rubber exports slid from the first quarter of 2015. In the first 11 months, China exported rubbers of 5.85 million tonnes, down 4.6 percent.
The investment also turned down. In the first 10 months, the planned rubber products investment projects dropped 8.9%, the number of completed projects slid 3.3%, and new projects increased 7.9 percent.
A number of tire companies stopped operation due to domestic economic slowdown, sluggish international economic recovery, the anti-dumping and anti-subsidy probelaunched by the U.S. against tires from China, overcapacity, higher environmental protection standards, poor corporate management, and tight cash flow.
According to a survey conducted by the Tire Division of CRIA, higher environmental protection standards are one of the primary elements resulting in closedown of 13 rubber companies.
Currently, less than 70% of China’s tire capacity is under operation. As a result, orders of rubber machinery companies decreased sharply and suffered operation difficulties.
Part of companies close to bankruptcy
Rubber chemical industry is also confronting a new round of survival of the fittest under higher environmental protection requests.
Today, China’s rubber chemical producers largely gather in Shandong, Hebei, Henan provinces and Tianjin municipality. Hebi city of Henan province is named ‘capital of rubber chemicals’ with many small- and medium-sized producers.
Hebi government has requested all rubber chemical producers entering the industry clusters for regulatory concerns, and some producers have been impacted by stricter environmental protection criteria.
As the wakening of people’s awareness of environmental protection and smog weather in larger areas of China, Chinese localities have enhanced their efforts to crack down companies who failed in meeting the environmental protection criteria or operating legally.
