Chinese demand for rubber products to reach RMB740 billion

Demand for rubber products in China is projected to grow 8.8% a year to RMB740 billion by 2017. Gains will be supported by healthy growth in manufacturing production, especially in the industrial machinery and motor vehicle industries. Strong demand gains for both consumer automobiles and other vehicle types, such as medium and heavy trucks and buses, will contribute to growth in demand for tyres and other rubber products.

A continuing shift in the tyre product mix toward higher-value product types such as radial tyres, run-flat tyres, air-free tyres, ultra-high performance tyres, and tyres of larger sizes will also help drive market gains in value terms. These and other trends are presented in Rubber Products in China, a new study from the Beijing office of US-based industry research firm Freedonia Group.

Tyres will continue to be the largest rubber product segment through 2017 and beyond, benefiting from expansion in both motor vehicle production and the motor vehicle park. According to analyst Linda Li, “Growing demand for higher-priced tyres as income levels continue to grow will further boost revenues.” Demand for industrial rubber products is forecast to advance 9.4% a year through 2017, benefiting from anticipated strong growth in the production of construction machinery, mining and metallurgy equipment, chemical and petroleum machinery, material handling equipment, and metalworking equipment.

The industrial machinery and motor vehicle markets have the largest impact on overall rubber product sales, as they accounted for 72% of total demand in 2012. Gains in these two markets are forecast to outpace the market average through 2017. Sustained plans to expand industrial machinery and motor vehicle production will continue to stimulate growth. Rubber product demand in the aerospace and other transportation equipment market is projected to grow at the fastest rate through 2017, benefiting from strong increases in the production of commercial aircraft and helicopters, as well as aircraft parts.