China Experiences a Resurgence in Passenger Car Tire Exports

In the closing month of 2023, China's export landscape for passenger car tires witnessed a substantial uptick, with the export volume reaching 244,300 tonnes. Despite this positive trend, the average export price experienced a marginal decline, settling at Yuan 2,677.69 per tonne. This reflected a 0.12% drop on a monthly basis and a 3.98% decrease year-on-year. The culmination of export activities throughout the entire year of 2023 showcased an outstanding 20.29% year-on-year improvement, reaching a cumulative export volume of 7,876,600 tonnes.

In stark contrast, China's import of passenger car tires in December 2023 amounted to 5,800 tonnes, indicating a noticeable decline of 17.90% from the previous month. The average import price settled at Yuan 7,464.63 per tonne, marking a noteworthy 15.48% increase month-on-month and a significant 14.04% rise compared to the same period in the previous year. Throughout the entire year of 2023, the cumulative import volume reached 69,000 tonnes, representing a 15.48% decrease year-on-year.

The net exports, calculated as the difference between exports and imports, amounted to 238,500 tonnes in December 2023. This substantial figure indicated a growth of 2.44% month-on-month and an impressive 15.08% increase year-on-year. Notably, there was a robust demand for exports from semi-steel radial tire enterprises, contributing to the overall positive trend in the passenger car tire export sector.

A comprehensive analysis of export destinations by continent throughout 2023 revealed a notable shift in the export volume to Europe. After experiencing a declining trend, there was a remarkable rebound of 19.21% to reach 104,800 tonnes in December. This positive development was particularly evident in Russia, where there was an 8.44% rise in export volume. The resurgence in European exports was attributed to the gradual easing of the Red Sea situation, enabling Chinese cargo ships to navigate freely and contributing to the positive trajectory of the passenger car tire export market.

Simultaneously, data from the Shanghai Shipping Exchange shed light on broader market dynamics. The China Container Freight Index (CCFI) demonstrated a substantial increase of 12.91%, reaching 1,287.49 as of January 19, 2024. This significant surge in prices, however, had a dampening effect on customer demand for shipping. Consequently, there was a restraint in the rebound of passenger car tire exports to some extent. Despite this challenge, there is an optimistic anticipation that export volume may continue growing, potentially reaching around 250,000 tonnes in January 2024.

This positive projection is primarily attributed to the abundance of orders as enterprises engage in stockpiling activities in preparation for the upcoming Spring Festival holiday. Additionally, there is potential for a reduction in transportation time for exports to Europe by nearly 20 days. This optimistic outlook stems from assurances provided by the Houthis to Chinese freighters entering the Red Sea, facilitating smoother trade routes and contributing to the potential growth in export volume.

While the overall increase in shipping prices poses a challenge to the growth in exports, the Chinese passenger car tire export volume is expected to show significant improvement. This optimistic outlook is built upon the relatively low export figures of the previous year, coupled with favorable factors such as strong export orders and geopolitical developments facilitating smoother trade routes. The industry remains confident about continued expansion and economic resilience in the passenger car tire export sector, showcasing the adaptability of the market to evolving global dynamics.