Europe replacement consumer tyre Q1 sales fall, SBR demand remains soft

Author: Melissa Hurley


LONDON (ICIS)--Replacement consumer tyre sales declined slightly in the first quarter, according to the European Tyre & Rubber Manufacturers’ Association (ETRMA).

Meanwhile, players in the styrene butadiene rubber (SBR) market, which has the tyre sector as a key end consumer, confirmed demand remains soft as the automobile sector's sales fall.

In 2018, there were low sales in the first quarter and a recovery later in the year.

It remains uncertain, however, if a potential recovery in the second quarter would balance out the decline registered in the first.

European tyre replacements remained mostly stable in 2018.

During the first quarter of 2019, truck tyre replacement registered a 9% growth, continuing last year's positive trend.

The agricultural sector's fortunes changed in the first quarter, with a 1% increase year on year. In 2018, the sector performed poorly for the fifth consecutive year.

A general slowdown in automotive demand has generated a level of uncertainty, which is straddling the commodity markets.

According to the European Automobile Manufacturers' Association (ACEA), passenger car registrations fell in March by 3.9%, and by 3.3% in the first quarter.

“All in all, the 2019 Q1 figures confirm a relatively stable market evolving according to earlier observed trends", said Fazilet Cinaralp, secretary general of ETRMA.

The largest use for SBR is in the manufacture of tyre products.

The replacement tyre market drives the majority of SBR demand, along with the original equipment market.

Lower-than-expected demand in the SBR market has been a key talking point this year.

The European SBR market is long in supply as export to Asia is not attractive due to continued weak demand overseas.

European players have said there has not been a clear pick-up in demand in the second quarter so far.

"Demand seems not too good", said a trader on Wednesday.

Picture source: Nathalie Lieckfeld/imageBROKER/REX/Shutterstock 

Focus article by Melissa Hurley