14 September 2009 07:53 [Source: ICIS news]
By Judith Wang, Dolly Wu and Helen Yan
SHANGHAI (ICIS news)--China will have to cut its tyre production following a decision by the US, a major tyre market for China, to levy an additional tariff on imports of the Chinese product, analysts said on Monday.
Starting 26 September, the ?xml:namespace>
This extra tariff rate will decline to 30% in the second year and 25% in the third year.
The existing tariff is around 3.4-4.0%.
“It is the biggest strike on
“It is not very easy to explore the new markets, so plant closures and output reduction will be the helpless choices,” said Ran from Century Securities.
Wang Liusheng, an analyst with brokerage China Merchants Securities, said that
The tyre industry’s upstream synthetic rubber market was bracing for some cost pressures following the
“We expect demand from tyre makers in
Prices of natural rubber, which is used as substitute for synthetic rubber, fell on Monday in Asia due to the new
“This will put pressure on the synthetic rubber prices to fall,” a synthetic rubber maker said, adding that the fourth-quarter contract talks with Chinese tyre makers will be most challenging amid the current difficult market conditions.
“[We] will settle [synthetic rubber] contract prices for October on a tentative basis and wait for a clearer picture before we start to talk about November or December contracts,” said a source from a major tyre maker.
It further countered that Chinese tyres mainly catered to the automobile repair market in the
In an apparent direct response,
($1 = CNY6.83/$1 = Y90.58)
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