Shandong-EU tyre exports maintain high growth rate

Tyrepress China learned that China’s Shandong Province exported 75.419 million new pneumatic rubber tyres in the first quarter, an increase of 11.1% over the same period last year. The total export value was 19.45 billion yuan, a year-on-year increase of 17.6%; the average export price was 257.9 yuan per tyre, a rise of 5.8%.

To contrast with Shandong’s figures, Tyrepress China lists China’s export data for the first quarter of 2023. From January to March, China’s tyre export volume was 139 million, an increase of 1.3% year-on-year; the export value was 33.385 billion yuan, an increase of 20.4%.

Putting the tyre export data of Shandong and China together, Tyrepress China can roughly draw two conclusions. From the perspective of tyre export volume, Shandong accounts for about 54 per cent of the national export volume, but the growth rate of Shandong Province (11.1%) is much higher than the national level (1.3%). From the perspective of tyre export value, Shandong accounts for about 58% of China’s total, but the growth rate of Shandong Province (17.6%) is lower than that of the whole country (20.4%). In other words, other regions of China exported more high-value tyres than Shandong Province.

In addition, the exporting countries of Shandong tyres need to pay special attention. In the first quarter of 2023, Shandong exported 1.61 million tyres to the United States, a significant decrease of 64.9 per cent. However, the decline in Shandong tyre exports to the US market is something other than just happened in 2023. If calculated based on a year-on-year decrease of 64.9 per cent, the number of tyres exported from Shandong to the United States in the first quarter of 2022 was only 4.6 million.

Tyrepress China believes three reasons may cause the sharp decline in tyres exported from China to the United States. First, the high tariffs imposed by the United States have indeed impacted China’s tyre exports. Second, the overseas factories of Chinese tyre companies have begun to exert their strength. In 2022, the expanded production capacity of some sizeable Chinese tyre manufacturers’ Southeast Asian factories reached production capacity one after another. This part of production capacity may be released in early 2023 and indirectly affect the export of Chinese tyres to the United States.

Third, some tyre exporters are adopting the “curve” export. An industry insider told Tyrepress China at the Guangrao tyre exhibition that some tyre exporters first export tyres to “intermediate” countries with lower tariffs and then export tyres from the “intermediate” countries to the final destination, the United States. Through this way of transit, tyre exporters avoid the high tariffs incurred by direct export of Chinese tyres to the United States.

It is worth noting that the number of Shandong tyres exported to the EU market increased rapidly in the first quarter of 2023. From January to March, Shandong exported 12.517 million tyres to the EU market, an increase of 16.3%. In other words, for every 100 tyres exported by Shandong in the first quarter of 2023, about 17 tyres were shipped to the EU. Qingdao Customs summarised the increase as “the appreciation of the euro and the decline in sea freight are good for European customers’ purchases, coupled with the high quality and brand effect of products exported to Europe”.

During the same period, Shandong’s exports to emerging markets, such as countries along the “Belt and Road” and Latin America, proliferated. For example, Shandong exported 4.396 million and 4.011 million tyres to Mexico and Brazil, respectively, an increase of 31.6% and 65.1% year-on-year.