Strong OTR Tyre Demand Continues Despite Glum Mining Outlook

In spite of a less than rosy outlook for global raw metal sales, orders for mining tyres and other items of equipment continue unabated. And manufacturers of these items are wagering that, in the long term, demand for their products will remain strong.

“Everybody agrees that in the long term, five to ten years, the Chinese, the Indian and the Brazilians will grow and they will need more minerals and more energy,” Luc Minguet, president of Michelin North America’s Earthmover and Industrial Tires division told Reuters. “We have not seen any slowdown yet, but what could happen nobody knows.”

The mining industry has been working flat out to meet demand from a booming commodity market over the last five years, with prices of metals such as copper rising fivefold. “We are ramping up capacity as fast as we can…we cannot get the equipment to make these big tyres fast enough,” Minguet added.

OTR tyre shortages are now old news, yet for machinery manufacturers the problem is an ongoing one. “One bottleneck for us has been the tyre industry,” said Klas Magnusson, information officer at Volvo Construction and Equipment, a subsidiary of Volvo Group. “A couple of years back the situation was really bad for some machines with lead times up to a year, but now these take maybe three months to deliver.”