China’s environmental inspection raises tire prices

Beijing – China’s latest round of environmental inspection has been making splashes nation-wide. Shandong, a province strong in the chemical industry housing a number of tire plants and feedstock facilities, has been under serious impact from the tightening regulations.

In the province’s Zibo city alone, 5,000 chemical companies have been closed this year, Zibo-based chemical firm INOV’s deputy general manager Charlie Chen told Crain.

According to several chemical sector veterans, the authorities usually shut down such companies first and then decide which to put back on based on their environmental compliance.

China’s tire price has been rising in the wake of such measures. At least ten tire makers in Shandong province upped their prices by up to 5% in August, including the country’s major manufacturers such as Linglong, Sailun and Hixih.

Over 1,500 companies in Zibo have resumed production recently after passing the inspection, said local report by tireworld.com on 13 Sept.

China’s Ministry of Environmental Protection further promulgated a scheme, focusing the efforts to reduce air pollution on cities in Shandong and other northern China provinces surrounding Beijing, starting on 1 Sept.

Seven Shandong cities out of a total of 28 are named in the scheme. Many big tire makers have facilities located in those cities, such as Hixih’s headquarters Jining

A new round of price increases may be on the way.