Tyre sector comes out tops

stephen evans of ISRBTHE rubber market is expected to be given a boost by the tyre sector, as expressed by exhibitors and visitors alike at the eighth staging of the TyrexpoAsia 2011 exhibition, held from 29-31 March in Singapore. Accordingly, 160 exhibitors from around 40 countries took part in the largest staging of the exhibition’s 15-year history. It also had 3,578 visitors, an increase of 16% compared to the last show in 2009.

Robust tyre growth

The Secretary-General of the Singapore-based International Rubber Study Group (IRSG) is predicting strong global demand for tyres through to the end of the decade. Speaking at the opening of the show, Stephen Evans said that much of the extra demand will originate from China and India. He added, “From an overall perspective the years through to 2020 will be a period of opportunity for tyre makers and the replacement and service sectors.”

The OE and replacement tyre markets are expected to push the market along with OE passenger car tyre sales to grow from 290 million units in 2010 to 400 million units by 2020, while replacement car tyre sales will grow from 760 million units in 2010 to 1.2 billion units by 2020.

Evans also said that the current figure of 1 billion vehicles worldwide is expected to increase to 1.45 billion towards the end of the decade, with China alone to add on 200 million vehicles.

Raw materials riding high

As for the raw materials, 70% of natural rubber and 50% of synthetic rubber go into tyre production and global consumption is set to follow the increased activity in the tyre sector.

The 2010 consumption of 10.7 million tonnes of natural rubber for all markets (tyre and non-tyre) is forecast to grow to 15.4 million tonnes by 2020. The comparable figures for all synthetic rubber markets are 13.6 million tonnes in 2010, rising to 18.5 million tonnes by 2020.

Evans also added that this year, rubber consumption will be 10.7% higher than last year with demand to reach 11.2 million tonnes. “Though governments are hopeful of targets, with no new trees to tap, the inventory will be 100,000 tonnes short.” He added that the short supply may see the largest consuming country, China, resorting to latex alternatives like guayule, which is grown in the US.

Evans also said that natural rubber prices, which have tripled in the past two years, capped in February this year, due to the earthquake in Japan and dramatic increases in demands.

As for synthetic rubber, since early October 2010, prices have increased by 500%, from US$600 to US$3,000/tonne. Plus, the oil-based synthetic rubber has grown more expensive as oil prices have gone up, too.

Launches at the show

There were a few announcements at the show including Indian OTR manufacturer Balkrishna Tyres (BKT) that confirmed plans for a fourth tyre plant in the country. The US$300 million greenfield site investment in Gujarat is scheduled to come on stream next year and will boost the company’s capacity by 80%. BKT Executive Director Anurag Poddar said the additional capacity will allow the company to service its growing export markets and also channel it to the domestic market, which accounts for just 8-10% of the current output.

Another Indian company CEAT also confirmed plans to increase manufacturing capacity at its newly-commissioned Gujarat factory, with 300,000 passenger car tyres and 100,000 truck tyres/month.

UK-based tyre wholesaler Bond International, meanwhile, launched a new company, Admiral Asia to promote the Admiral passenger car tyre brand that has been sold successfully by Bond in the UK for the last six years.

The new company will operate in Singapore and retail a range of tyres comprising 74 summer tyres covering 13 to 20 in. wheel sizes, with Z-rated choices for the 17 to 20 in. options. There is also a 30-strong winter tyre range covering 14 to 17 in., T and H rated products. The range will be available from this April, with full stocks on stream from the beginning of next year.

New tyres in the market

The exhibition also provided a platform for the launching of new products. Singapore-based tyre manufacturer Omni introduced the Radar Verenti R6 UHP M&S range of 35, 40, 45 and 50 series tyre in 15 popular sizes. Also new is the Radar RCX8 crossover for small to mid-size SUVs. Eight sizes are initially available in 17, 18 and 20 in. wheel sizes.

CEAT introduced new car, SUV and 4 x 4 tyre ranges under the Rhino, Theta and Milaze brands plus a new range of CEAT truck and bus radials.

Stamford Tyres introduced a new range of winter tyres marketed as Firenza Nu Ice available in studdable and non-studdable options and 13 sizes covering 13, 14, 15 and 16 in. wheels.

Chinese manufacturer Shandong Linglong announced the launch of its Green-Max range of 19 green silica tyres while Singaporean distributor Mindtrac introduced a new range of bus and truck radials manufactured by Birla Tyres in Haridwar, India.

The exhibition is organised by UK-based ECI International that will have another edition in India, to run from 5-7 July at the Chennai Trade Centre, Chennai. More details can be found at www.eci-international.com