The mode of use of tires

The transmission of tire product price increases is not smooth, and some enterprises have increased tire inventories in 2021. Under the background of rising raw material prices combined with rising sea freight and weak domestic demand, tire companies' price increases are not smooth to the downstream or export, and the tire inventory of listed companies such as Cylun tires, SenQilin, General Shares, Linglong Tires, Qingdao Double Star and Guizhou tires has increased in 2021. Among them, the tire inventory of Cylun tires, SenQilin, Linglong tires and Guizhou tires increased by more than 30% year-on-year.

It is expected that the overall growth rate of natural rubber downstream tire demand will slow down in the future, and the supply side has not seen significant capacity reduction, so its price may be difficult to maintain a high level. 2002-2011, China's rapid economic development, natural rubber downstream demand is strong and the supply is relatively insufficient, in addition to the impact of the financial crisis in 2008, natural rubber prices are generally on the rise, this period the highest price of natural rubber to about 43,000 yuan/ton. Since 2011, on the one hand, China's economic growth began to slow down, auto production and sales have reached a peak, natural rubber downstream demand growth slowed down, on the other hand, the early expansion of rubber trees began to mature, in recent years, the supply side capacity has not been reduced, natural rubber supply and demand relationship has been reversed, In the past three years, its price has fluctuated between 11,000 and 14,000 yuan/ton. According to this analysis, the price of natural rubber will remain low in the long run, and its price trend has shown signs of reversal in the short term.

Consolidation is showing signs of easing, and the consolidation cycle is nearing an end

The container market is expected to show some signs of easing. The shipping industry is obviously affected by macro-economy and is a typical cyclical industry. Reviewing the operation of the container shipping market in the past 20 years, it can be found that the price change cycle of container shipping is roughly 2-3 years. Since the second half of 2020, the current stage of container price increase may have ended, and the container market is expected to show signs of easing.

The market is actively responding to the problem of vehicle core shortage, and the shortage situation is expected to improve

The supply shortage of automotive chips is expected to improve, and the tight supply and demand of chips at the end of the year is expected to gradually dissolve. First, the affected fabs and sealed test plants have gradually recovered from the disaster and epidemic, and the original production capacity has been reused; Second, TSMC, Intel and other chip manufacturers have announced plans to build factories, which is expected to inject new capacity for automotive chips; Third, domestic automobile enterprises and various investment institutions actively seek domestic chip replacement, and the automotive chip industry chain is expected to increase in the domestic distribution.

Tire industry boom is expected to reverse

In the short term, the negative impact on the tire industry began to dissolve, and it is expected that the prosperity of the tire industry will usher in a reversal. In terms of "double counter-investigation", Chinese enterprises have actively expanded overseas production capacity in recent years, effectively avoiding the impact of tariff policy on tire exports, and in the context of the epidemic, China, as one of the main markets for tire consumption, has also digested most of the production capacity of the tire industry, and the impact of trade policy on tire companies has gradually narrowed. In terms of raw material prices, the supply of natural rubber is not reduced, the price is difficult to maintain a high level in the long term, and it has begun to decline in the short term, and the cost pressure of tire companies has declined. In terms of freight prices, the cyclical market is obvious, the congestion of the port of Los Angeles in the west of the United States has been alleviated, and tire exports are expected to recover. In terms of automobile production and sales, the lack of core began to ease, the decline in automobile production and sales narrowed, and the production and sales of new energy vehicles were strong, boosting the downstream supporting market.