Tire and tyre situation

Recently in China, the COVID-19 is severe. All the provinces have infection. Many communities, schools and tire factories were blocked, and so did many tire factories. Many tire factories in Shandong province have been blocked for two weeks, orders and shipment delayed. Once situation improved, the delivery will be more in short time, and the freight charges to the Middle East may rise. But it will not continue long, due to slow global economy.

With the winter coming and virus mutation, COVID-19 communication ability will become more stronger, speed faster. The situation of blocking may still appear.

It is estimated the export tire price will not fluctuated much for a long period of time. The main reasons as follows:

* The raw material cost of tire fluctuated not largely in 2022. The main factor to push tire export price decrease is the RMB depreciation. This week, USD/CNY reached about 7.3 three times and fell finally. As the US dollars rate hikes narrows, USD/CNY will not likely to increase too much.

* The global economy growth slow down, the general demands weak, so the raw materials cost has low probability to increase largely.