At the 2008 China Rubber Market Development Forum and the just concluded "Two Conferences", the future development of the rubber industry has received widespread attention from many representatives. In particular, a series of chain reactions triggered by the scarcity of natural rubber resources in China has always touched the industry. The sense of urgency. In this year's "Two Conferences" proposal, the call for "natural rubber as an import commodity restricted by processing trade is unreasonable" has once again begun to sound. The target is directed at the tariff problem of China's natural rubber imports.
Large gaps confront high tariffs At present, China consumes more than 2 million tons of natural rubber annually, but domestic production is only around 600,000 tons, and the self-sufficiency rate has fallen below the 30% safety level. Since the accession to the WTO, the proportion of natural rubber imports to the country’s total consumption has been around 70%, up from 75.6% in 2007. According to the calculation of domestic natural rubber production in the past few years and the “Eleventh Five-Year Plan†development plan, the import volume of natural rubber will increase by about 100,000 tons per year over the next 5 to 10 years. The proportion of imported rubber that accounts for 70% of the total consumption will not big change. According to estimates by the International Rubber Research Organization, the gap in China's natural rubber will be 2 million to 3 million tons by 2020, and the shortage of natural rubber resources will threaten the sound development of the rubber industry. As the production of tires, especially radial tires, is mainly based on natural rubber, this has forced the tire industry to accelerate development while spurring rapid growth in demand. At the same time, it has to suffer from the shortage of natural rubber resources and high raw material costs.
Although the domestic supply of natural rubber is seriously insufficient, it is also an important strategic material of our country. In 2007, natural rubber import and export began to implement selective tariffs, but the adjusted tariff level was still 10% to 20%, and it was difficult to ease the pressure from resource bottlenecks on rubber product companies.
Domestic supply of natural rubber is limited and its potential is limited. Imports are again limited. Where can the tire industry go? Under such circumstances, imported natural rubber is indeed “near water†that can “threat-quenchâ€. If the 20% high tariff is still adhered to, the shortage of natural rubber resources will become an engine of development of the rubber industry.
Compound rubber seizes the rising price of raw materials in the import market in recent years. At present, the proportion of raw material costs of the tire companies to total production costs has risen to 70% to 78%. Domestic natural rubber not only has limited resources, but also has certain differences in quality and imported rubber. The development of high-performance tires still requires a lot of imported rubber. Companies that rely on natural rubber imports have complained about excessive tariffs. Compound rubber, a new product with Chinese characteristics, came into being. The import tariff from ASEAN was only 5%, and its proportion in natural rubber imports increased rapidly.
The fact that the volume of imported rubber in the general trade has increased rapidly indicates that it is likely to become the main mode of China's natural rubber import trade in the future. Compound rubber used to be a “three-nothing†commodity in China—no definition, no standard, no testing organization. In 2006, the China Rubber Industry Association organized and formulated a self-regulatory specification for composite rubber. The Ministry of Commerce also submitted a special report to the State Council in August 2006, stating that the current import tariffs for natural rubber are unreasonable, and that the self-regulatory standards for composite rubbers in the industry associations have been raised to national industry standards, so that the compounding rubber industry has laws to follow.
The emergence of compound glue has a greater impact on the import situation of natural rubber, but it is not a fundamental solution to the problem. Reasonably lowering import tariffs and alleviating famine in natural rubber resources is a practical move to consider for the plight of the industry. Naturally, the debate over compound rubber will also be calm.
Linkages to the industry chain problems When the import tariff of natural rubber has not yet subsided, the way it processes re-exports has caused a lot of controversy. Since 2007, the state has tightened the restrictions on the export of rubber products, and the reduction in export tax rebates has had a huge impact on export companies. Recently, there is news that the processing trade of rubber products may be limited. If this restriction becomes a reality, it will have a greater impact on the entire rubber industry. According to a person in charge of a large-scale tire company in China, due to the soaring raw material costs, the reduction of export tax rebates, and the appreciation of the renminbi, the company’s profit loss in 2007 reached 100 million yuan.
In order to cope with the increase in prices of raw materials for digestion and the reduction of export tax rebates, tire companies have to adopt price increases first. In a short period of time, the market's ability to withstand price changes is limited. In addition, the export restrictions have increased the pressure on the domestic market. At the same time, the sluggish sales of products have made the company's liquidity more strained, and the problem of high tariffs has become increasingly severe. It has also indirectly affected the capital investment in the development and upgrading of new products. Natural rubber supply is the starting point for the industrial chain of rubber industry. It is more worthwhile for national industrial policy makers to communicate with industry associations and companies. Ultimately, it can find the best solution to the shortage of natural rubber resources based on the rational use of resources.
Large gaps confront high tariffs At present, China consumes more than 2 million tons of natural rubber annually, but domestic production is only around 600,000 tons, and the self-sufficiency rate has fallen below the 30% safety level. Since the accession to the WTO, the proportion of natural rubber imports to the country’s total consumption has been around 70%, up from 75.6% in 2007. According to the calculation of domestic natural rubber production in the past few years and the “Eleventh Five-Year Plan†development plan, the import volume of natural rubber will increase by about 100,000 tons per year over the next 5 to 10 years. The proportion of imported rubber that accounts for 70% of the total consumption will not big change. According to estimates by the International Rubber Research Organization, the gap in China's natural rubber will be 2 million to 3 million tons by 2020, and the shortage of natural rubber resources will threaten the sound development of the rubber industry. As the production of tires, especially radial tires, is mainly based on natural rubber, this has forced the tire industry to accelerate development while spurring rapid growth in demand. At the same time, it has to suffer from the shortage of natural rubber resources and high raw material costs.
Although the domestic supply of natural rubber is seriously insufficient, it is also an important strategic material of our country. In 2007, natural rubber import and export began to implement selective tariffs, but the adjusted tariff level was still 10% to 20%, and it was difficult to ease the pressure from resource bottlenecks on rubber product companies.
Domestic supply of natural rubber is limited and its potential is limited. Imports are again limited. Where can the tire industry go? Under such circumstances, imported natural rubber is indeed “near water†that can “threat-quenchâ€. If the 20% high tariff is still adhered to, the shortage of natural rubber resources will become an engine of development of the rubber industry.
Compound rubber seizes the rising price of raw materials in the import market in recent years. At present, the proportion of raw material costs of the tire companies to total production costs has risen to 70% to 78%. Domestic natural rubber not only has limited resources, but also has certain differences in quality and imported rubber. The development of high-performance tires still requires a lot of imported rubber. Companies that rely on natural rubber imports have complained about excessive tariffs. Compound rubber, a new product with Chinese characteristics, came into being. The import tariff from ASEAN was only 5%, and its proportion in natural rubber imports increased rapidly.
The fact that the volume of imported rubber in the general trade has increased rapidly indicates that it is likely to become the main mode of China's natural rubber import trade in the future. Compound rubber used to be a “three-nothing†commodity in China—no definition, no standard, no testing organization. In 2006, the China Rubber Industry Association organized and formulated a self-regulatory specification for composite rubber. The Ministry of Commerce also submitted a special report to the State Council in August 2006, stating that the current import tariffs for natural rubber are unreasonable, and that the self-regulatory standards for composite rubbers in the industry associations have been raised to national industry standards, so that the compounding rubber industry has laws to follow.
The emergence of compound glue has a greater impact on the import situation of natural rubber, but it is not a fundamental solution to the problem. Reasonably lowering import tariffs and alleviating famine in natural rubber resources is a practical move to consider for the plight of the industry. Naturally, the debate over compound rubber will also be calm.
Linkages to the industry chain problems When the import tariff of natural rubber has not yet subsided, the way it processes re-exports has caused a lot of controversy. Since 2007, the state has tightened the restrictions on the export of rubber products, and the reduction in export tax rebates has had a huge impact on export companies. Recently, there is news that the processing trade of rubber products may be limited. If this restriction becomes a reality, it will have a greater impact on the entire rubber industry. According to a person in charge of a large-scale tire company in China, due to the soaring raw material costs, the reduction of export tax rebates, and the appreciation of the renminbi, the company’s profit loss in 2007 reached 100 million yuan.
In order to cope with the increase in prices of raw materials for digestion and the reduction of export tax rebates, tire companies have to adopt price increases first. In a short period of time, the market's ability to withstand price changes is limited. In addition, the export restrictions have increased the pressure on the domestic market. At the same time, the sluggish sales of products have made the company's liquidity more strained, and the problem of high tariffs has become increasingly severe. It has also indirectly affected the capital investment in the development and upgrading of new products. Natural rubber supply is the starting point for the industrial chain of rubber industry. It is more worthwhile for national industrial policy makers to communicate with industry associations and companies. Ultimately, it can find the best solution to the shortage of natural rubber resources based on the rational use of resources.
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