Over 60 Tire Companies Raise Prices Collectively Amid Natural Rubber Surge(Oct 15)

Over 60 Tire Companies Raise Prices Collectively Amid Natural Rubber Surge

As natural rubber prices continue to climb, the tire industry has ushered in a new round of collective price increases. According to incomplete statistics from Securities Daily, since September, more than 60 tire companies have issued over 70 price increase notices, covering all categories including all-steel tires, semi-steel tires, and engineering tires, with increases ranging from 2% to 5%. During the National Day holiday alone, more than 20 companies adjusted prices, with 9 companies raising prices twice within a short period.

Fourth Round of Price Increases This Year

Raw materials account for over 70% of tire production costs, with natural rubber, synthetic rubber, and carbon black as the three core raw materials collectively accounting for over 60%. According to Shanghai Futures Exchange data, the natural rubber main contract closed at 20,645 yuan per ton on October 9, up 2.89% on the day, with an intraday high of 20,775 yuan per ton, reaching a nearly nine-year high. The spot market average price reached 19,700 yuan per ton, with a year-to-date increase of 28.27%.

On September 30, the SHFE natural rubber main contract closed at 20,095 yuan per ton, the first close above the 20,000 yuan per ton threshold since March 2017. During the National Day holiday, overseas rubber prices continued to rise: as of October 7, Singapore TSR20 and Japan rubber main settlement prices rose 0.98% and 1.55% respectively from pre-holiday levels.

Beyond natural rubber, other tire raw materials also remained at high levels. As of the end of September, semi-steel and all-steel tire raw material cost indices were up approximately 25% year-on-year. Carbon black benchmark prices reached 11,692.86 yuan per ton on October 1, up 59.74% year-on-year and hitting a six-year high. Butadiene rubber and styrene-butadiene rubber rose 39% and 36% year-on-year respectively.

TBR Replacement Market Becomes the Main Battlefield

This round of price increases exhibits distinct structural characteristics: the TBR (Truck and Bus Radial) replacement market has become the primary battlefield. On October 10, Linglong Tire announced a 3% price increase for all TBR brand product series in the domestic retail market effective November 1. On October 12, Xiongying Rubber Technology followed with a 3% to 5% increase, explicitly stating that prices would be based on delivery date rather than order date, to prevent distributors from placing orders before the increase and picking up at old prices.

Weifang Yuelong Rubber implemented a 3% price adjustment from October 10 and explicitly stated it would not accept advance payments. This clause is particularly noteworthy: companies believe raw material prices will continue rising and are unwilling to lock in future orders at current prices to avoid selling at a loss.

Going Global Becomes Industry Consensus

China Association of Automobile Manufacturers data shows that from January to August, automobile exports reached 7.153 million units, up 66.7% year-on-year. The rapid growth of automobile exports has boosted demand for domestically produced tire matching and replacement. Thanks to the continued overseas expansion of domestic new energy vehicles, the tire industry is focusing on the high-end original equipment market, enhancing product value and building technology barriers to hedge against raw material cost uncertainties.

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