Weak demand dominates makes rubber market prices difficult to strengthen

Looking back at history, from 2007 to 2008, the overheated global economy boosted the production, sales volume and tire consumption of new vehicles. The overestimation of demand caused a rapid rise in the level of commodity premiums. With the temptation of high natural rubber prices, both the rubber garden owner and the rubber peasant were inspired by the unprecedented desire to grow plastic. Large areas of primeval forest were replaced by a single rubber plantation. However, "Golden Age" was short-lived, and it immediately went into recession and depression. Constrained by the growth cycle of 7-8 years, there is a significant lag in the rubber tree from seeding to producing glue, and the slow pace of adjustment has led to a global stalemate in natural rubber production capacity since 2013.

In the following two years, although the traditional rubber-producing countries—the governments of Thailand, Indonesia, and Malaysia—have tried hard to intervene in rubber prices several times, they have had little success. As a last resort, Thailand has taken the lead in tearing the horse and cutting down trees to increase production capacity. However, it is difficult to step away from capacity, and the government often stops by the pressure of rubber farmers. In addition, the trees that are cut are all old rubber trees and the number is limited. It is difficult to match the production capacity of the new rubber gardens. Therefore, overall, the natural rubber supply side still maintains a slight growth trend.

According to the latest IRSG report of the International Rubber Research Organization, Thailand and Vietnam have continued to increase their glue production at low prices since the beginning of this year. Thailand, the largest rubber-producing country, increased its rubber exports by 1.3% year-on-year to 1.72 million tons in the first half of this year. Vietnam, the third-largest producer, increased shipments by 16% to 530,000 tons in the first seven months of this year. Although export of natural rubber was affected by the decrease in trade volume between the rubber-producing countries, especially the decrease in China's imports, the export volume increased by 1% year-on-year. This was mainly due to the increase in exports from developed countries which offset the export volume among member countries, especially to China. Decline. According to statistics, the export data of Malaysia, Cambodia, and the Philippines in the first eight months of this year all showed double-digit growth rates, which were 15.2%, 34.4%, and 22.7%, respectively. Vietnam's exports increased by 8.6% to 619,500 tons. Complete 60% of this year's export goal.

Against the background of the continued expansion of production capacity by the rubber-producing countries, it is expected that the global natural rubber market will remain in a situation of oversupply this year, with a surplus of around 300,000 tons. Among them, natural rubber supply will increase by 4.4% from last year to 12.6 million tons, and demand growth will decrease from 6.7% last year to 1.2% to 12.3 million tons. In addition, a large number of rubber trees planted at high prices will enter the mature stage next year, and rubber production may continue to grow by 2.9% next year, and the oversupply situation will also intensify. The rubber price is expected to face further risk of falling.

Auto market sales turn into a period of shrinkage

Affected by the deceleration of economic growth, the demand growth of the automotive industry, which is the end demand of natural rubber downstream terminal, continues to slow down and turn into a shrinking period. In July, the production and sales volume of automobiles decreased significantly compared with the previous month, and also showed a rapid decline year-on-year. In July, production and sales volume fell more than expected, and the third consecutive month was lower than the level of the same period of last year. The last monthly production and sales decline for three consecutive months was from November 2008 to January 2009.

The overall data shows that from January to July, the production and sales of automobiles reached 13.6127 million units and 13.3333 million units respectively, an increase of 0.8% and 0.4% over the same period of the previous year. The monthly cumulative increase continued to fall, and fell 8.7 and 7.8 percentage points over the same period of the previous year respectively. . In terms of passenger vehicles, from January to July, the production and sales volume reached 11.622 million units and 11.3642 million units, respectively, which represented an increase of 4% and 3.4% respectively over the same period of the previous year, and the growth rate decreased by 8.2 and 8.6 percentage points respectively. In terms of commercial vehicles, from January to July, 1,827,700 vehicles and 1,819,100 vehicles were sold and sold, respectively, down 14.6% and 13.9% over the same period of the previous year.

Despite the slowdown in production and sales growth in the automotive market, new energy vehicles have risen against the trend. According to statistics from the China Automobile Association, from January to July, new energy vehicles produced 95,530 vehicles and sold 89,049 vehicles, which was an increase of 2.5 times and 2.6 times respectively. The production and sales of new energy vehicles are hot, but their market share is small at present, and it is difficult to fill the gap brought about by the shrinking demand for traditional automobiles in the short term. In addition, the current purchasing power of the terminal segment (dealers to customers) is weak, and dealer inventory remains high.

China's car dealers inventory warning index shows that in August the domestic car dealer inventory warning index was 48.7%, a decrease of 4.7% from the previous month and a year-on-year decrease of 1.6%. After exceeding the warning line for 10 consecutive months, the warning index was lower than the first line for the fore and aft. Mainly due to the automakers to reduce output speed, while increasing sales efforts. However, facing the downward pressure of the domestic economy, the auto market has already bid farewell to the era of rapid development. Consumer demand has been relatively reduced, dealers’ inventory has increased, and profits have declined.

In addition, since the beginning of this year, the domestic heavy-duty truck industry has continued to shrink, and in August it is still in the doldrums. The statistics of the first commercial vehicle network show that in August, the heavy-duty truck market sold 35,000 vehicles, a decrease of 27% year-on-year and a 6% decrease from the previous month; from January to August, the heavy truck market accumulated 367,700 vehicles, a year-on-year decrease of 30%. Only a 30.6% reduction from January to July narrowed a little.

The author believes that the narrowing down of sales volume in the heavy truck market is merely a representation. The main reason is not that the market is picking up, but that the base figure of the same period last year has become smaller. This year, the domestic macro-economy continues to decelerate, and the manufacturing industry has entered a stagnant “new normal”. The logistics and transportation market is in the doldrums and the freight rates have been falling. The heavy-duty truck market has not been prosperous. Under the oppression of “multiple mountains”, various companies did not say that they actively planned production. Many companies did not digest the national triple-stock vehicles that had been on the market ahead of the end of last year, which also caused the heavy-duty truck market in each month in recent months. The drop is very alarming. On the surface, the narrowing down of sales volume of cards and the fundamental fact of reversing the market decline have not been improved. This undoubtedly casts a shadow on the heavy-duty card market from September to December.

The author believes that even if the automobile market is transferred to the "Golden September" peak season in the later period, the market will hardly have room for recovery. Under the predominance of weak demand, rubber prices will be difficult to strengthen.

Tire industry is at stake

The survival of the Chinese tire industry in recent years is in jeopardy. Not only has the domestic sales market started to shrink, but its overseas market share has also suffered frequent trade setbacks.

In terms of overseas markets , China's passenger car and light truck tires are highly dependent on the U.S. market, and 40% of China's tire production needs to be exported, of which the U.S. has a share of nearly 30%. However, the United States is also one of the countries that has launched a "double counter" investigation on Chinese export tires. Affected by the "double reverse" in the United States, tire factories in Shandong and Fujian have already closed down this year, and domestic tire factories have actively reduced their operating rates.

According to statistics from the China Rubber Industry Association, in the first half of this year, under the background of increasing economic downward pressure, the demand for the domestic tire market continued to be sluggish. The average operating rate of the industry was 60%, which was more than 10 percentage points lower than the same period of last year. Falling into the situation. The financial data provided by 42 tire members also corroborated the pressure on the company. According to the statistics, from January to July, the tire production of the above-mentioned enterprises decreased by 8.27%, inventory of finished products rose by 11.4%, sales revenue decreased by 14.32%, profit decreased by 32.51%, losses amounted to 436 million yuan, and the loss range increased, including domestic-funded enterprises. The loss amounted to 390.51 million yuan, and the loss increased by 199.52%. The further increase in the amount of loss and the area of ​​loss not only marked the end of the glory of the Chinese tire industry, but also marked the long-term existence of the "new normal" of low-priced natural rubber.

In addition, after the new rubber compound regulations landed, it was unrealistic to attempt to import compound rubber through zero tariffs. Tire companies can only purchase natural rubber as a raw material for production. Therefore, imports of natural rubber began to blowout in July. According to the latest data released by the General Administration of Customs of China, natural rubber imports amounted to 267,600 tons in July, a month-on-month increase of 73%, an increase of 70% over the same period of last year, and imports of natural rubber from January to July were 1,396,300 tons, a year-on-year decrease. 11.5%. At the same time, the import volume of synthetic rubber in July was 152,700 tons, a decrease of 11.5% from the previous period and a year-on-year increase of 27%. From January to July, the import volume of synthetic rubber was 9,655,000 tons, a year-on-year increase of 10%.

With the acceleration of the pace of external procurement, stocks have shown signs of recovery. As of the end of August, rubber stocks in Qingdao Free Trade Zone rose to 146,600 tons, an increase of 16,500 tons, or 12.68%, compared to mid-range. Specifically, natural rubber was 120,600 tons, an increase of 19,400 tons compared to the end of July, becoming the increase in inventory The main rubber species; compound rubber was 0.9 million tons, which was a decrease of 0.4 million tons compared with the end of July, and the overall decline was significant; synthetic rubber was 17,000 tons, an increase of 0.11 million tons from the end of July, an increase of 6.92%.

Cutting costs or drastically decreased

Cutting costs or drastically decreased
Cutting costs or drastically decreased

In general, the production cost of natural rubber consists of three major components: First, the cost of planting; Second, the labor cost of tapping; Third, the cost of processing and transportation.

Among them, labor costs account for a large proportion of total costs. It is understood that workers are required to go to the Rubber Yard at 3 am until sunrise because this is the best time for rubber tree tapping. Due to the harsh rubber tapping time, harsh environment and high work intensity, most young people do not want to do this work. At present, in the domestic production areas, except for some home-style small micro glue fields, plastic farmers independently tap rubber. Medium-sized and above rubber fields generally adopt the pattern of hiring workers to tap rubber, and they agree with workers that they should be divided into sixty-four divisions. In other words, rubber garden owners often have to bear high labor costs in order to attract labor.

At present, tapping rubber in domestic natural rubber production areas depends entirely on labor, the efficiency of operations is low, and the quality is difficult to guarantee. The newly-developed and fully-automatic tapping machine not only has the function of rubber cutting, but also has a set of big data system, which can tap rubber with high efficiency, and statistically analyze the indexes of rubber production, quality, soil detection, humidity, etc. to achieve natural rubber cutting. Automation and informatization.

It is understood that the cost of fully automatic tapping machines is only 1,200-1,500 yuan after constant adjustment of programs, improved technologies, and reduced costs. Compared with manual tapping, large and medium-sized rubber gardeners are more willing to use automatic tapping machines. With 800 rubber trees as a unit, it takes an average of one minute for a cutter to cut a tree, and with a fully automatic tapping machine, 800 trees can be tapped at the same time. It takes only 30 seconds. In addition, the high precision of the machine will not cause damage to the rubber trees. The rubber tree tapping life will be extended from the previous 8 years to 10-11 years, and the output will increase by 30%-40%.

The author estimates that the rubber production rate of the automatic tapping machine is 2.6 to 2.8 times that of the artificial tap rubber. It is calculated by dividing the price of the four-fourth model and the price of 12 yuan/kilogram of the plastic adhesive, and the adhesive is divided into the tapping workers. The cost is 7200 yuan/ton, and with the automatic tapping machine, the cost for dispensing the tapping machine is only 2571-2770 yuan/ton under the same dry glue production. If the automatic tapping machine completely replaces the manual in the future, in the light labor cost, the unit amount of dry glue can save 4430-4629 yuan/ton.

According to relevant research findings, the critical point for conversion to conversion at the cost of 300 yuan/mu was 12448 yuan/ton in Hainan and 9942 yuan/ton in Yunnan. If manual tapping is gradually replaced by fully automatic tapping machines, the cost of tapping will be significantly reduced, and the center of gravity of the rubber price will decrease as the cost moves downward. The author estimates that the cost of tapping in Hainan will drop to 7950 yuan/ton in the future, and Yunnan will drop to 5442 yuan/ton in the future. In the long run, Hujiao does not rule out the possibility of falling to the 6000-8000 yuan / ton range.

The downturn in the price of rubber does not happen overnight or one or two policies can be reversed. It is the truth to resolve the contradiction between supply and demand by reducing supply pressure through capacity reduction. Before large-scale production capacity is eliminated, it is not a good idea for Jiaojia to get rid of Xiongtu. What's more, with the improvement of the level of science and technology, the cost factor is not a natural barrier that supports the price of rubber. Hujiao is still in the “darkness” in the future. Investors need more patience and confidence to wait for dawn.

Bushing Parts:

A common application is in vehicle suspension systems, where a bushing made of rubber (or, more often, synthetic rubber or polyurethane) separates the faces of two metal objects while allowing a certain amount of movement. This movement allows the suspension parts to move freely, for example, when traveling over a large bump, while minimizing transmission of noise and small vibrations through to the chassis of the vehicle. A Rubber Bushing may also be described as a flexible mounting or antivibration mounting.Based on different embeded material,bushing could be divided into Steel Bushing,Cpper bushing,Aluminium Bushing,and rubber bushing.

These bushings often take the form of an annular cylinder of flexible material inside a metallic casing or outer tube. They might also feature an internal crush tube which protects the bushing from being crushed by the fixings which hold it onto a threaded spigot. Many different types of bushing designs exist. An important difference compared with plain bearings is that the relative motion between the two connected parts is accommodated by strain in the rubber, rather than by shear or friction at the interface. Some rubber bushings, such as the D block for a sway bar, do allow sliding at the interface between one part and the rubber.

 

Advantages and disadvantages:

The main advantage of a bushing, as compared to a solid connection, is less noise and vibration are transmitted. Another advantage is that they require little to no lubrication.

Disadvantages include:

(1)Bushings can deteriorate quickly in the presence of oils (e.g., motor oilmineral oil) and extreme heat and cold.

(2)Flexibility of rubber also introduces an element of play in the suspension system. This may result in camber, caster, or toe changes in the wheels of the vehicle during high-load conditions (cornering and braking), adversely affecting the vehicle's handling. For this reason, a popular aftermarket performance upgrade is the replacement of rubber suspension bushings with bushings made of more rigid materials, such as polyurethane. Polyurethane bushings are also available for many vehicles with approximately the same characteristics[citation needed] as the manufacturers original bushings, but with greatly increased durability.This is useful on vehicles that have a reputation for wearing out standard rubber bushings, but for which harder bushings with increased harshness of ride are not wanted.

Applications(automobile):

·         Anti-roll bar (US Sway bar) links and mountings

·         Shock absorber mountings

·         Double wishbone suspension assemblies

·         Gear stick for vehicles with a manual transmission

·         Most high-speed inline internal combustion engines are prone to torsional vibration of their crankshafts; the straight six and straight eight engines being particularly prone to this problem due to their long crankshaft length. Although straight eight engines faded from the marketplace in the 1950s, many straight six engines have and still do feature crankshaft vibration damping utilizing rubber bushes. The 3,442 cc Jaguar XK 6-cylinder engine of 1948 and most subsequent versions of the ubiquitous Jaguar XK engine used a proprietary Metalastik vibration damper to protect their crankshafts from potentially damaging torsional vibrations. To quote William Heynes, "The Metalastik damper consists of a steel plate to which is bonded, through a thick rubber disk, a malleable iron floating weight. Variations of the weight, rubber volume and mix, give these dampers a very wide field over which they can operate."

In skateboards, bushings enable the tilting of the trucks, thus allowing the board to turn.

In fastening, bushings are also used to transfer loads from a fastening to a much larger area in the underlying structure, the object being to reduce the strain on individual fibers within the underlying structure.  

Bushing Parts



Bushing Parts

Steel Bushing,Copper Bushing,Aluminium Bushing,Rubber Bushing

VESTA Motoring Ltd , http://www.vesta-industry.com