Chinese tire producers have been heavily dependent on exports to the US, but they need to upgrade their products and explore new markets, analysts said on Tuesday, following a preliminary determination by the US Department of Commerce against tire imports from China.
The US Department of Commerce announced on Monday its preliminary determination regarding anti-dumping duties on imports of truck and bus tires from China, the Xinhua News Agency reported on Monday (US time). The department said that such products from China had been sold in the US at dumping margins of 20.87 percent to 22.57 percent, according to Xinhua.
The US agency published a notice in February initiating a countervailing duty investigation on truck and bus tires from China, following petitions filed in January by US workers who make truck and bus tires, according to the US International Trade Commission.
This is not the first time the US has launched an anti-dumping probe into Chinese exporters. The department issued anti-dumping duty and countervailing duty orders in August 2015 on certain passenger vehicle and light truck tires from China, which allegedly injured the US industry.
"One main reason behind those successive investigations into our tire products is that Chinese producers export too many to the US, some of them even export 60 percent to 70 percent of their total production," Wu Chenhui, a Beijing-based independent analyst, told the Global Times on Tuesday.
The total value of China's tire exports was $13.19 billion in 2015, of which $2.7 billion went to the US, according to a report published in May by Shenzhen-based industry information provider askci.com. The website cited data collected by the China Rubber Industry Association, which represents more than 1,200 related enterprises.
The volume of exported tires dropped 4 percent year-on-year in 2015 to 5.2 million tons, which was mainly due to the increasing anti-dumping and anti-subsidy investigations initiated in markets like the US, the report noted.
"Some Chinese tires were exported to the US at relatively low prices compared with exports from other countries, which may raise concerns about alleged dumping activities," Guo Juan, an industry analyst at Shandong-based commodity market information provider sci99.com, told the Global Times on Tuesday.
Major exporters involved in the investigations such as Double Coin Holdings and Guizhou Tyre Co could not be reached by press time on Tuesday.
Facing increasing anti-dumping and anti-subsidy investigation claims not only from the US but also from markets such as Brazil and India, Chinese tire producers should upgrade some of their low-end products and become more competitive, not only overseas but also in the domestic market, Guo noted.
"Also, setting up factories overseas and exporting to new markets for example Africa could be feasible ways to fend off trade disputes," she said.
