SHANGHAI, Aug 24 (SMM) — Several tire producers have recently issued price increase letters. Rising prices of natural rubber and recovery of the automobile market led to the increases in tire prices, according to Huachuang Securities.

Zinc oxide is an essential additive for rubber and tire production. An SMM survey found that zinc oxide prices have rebounded since late March and averaged 19,400 yuan/mt as of August 24, bouncing back 32.9% from the lowest level in 2020.

Currently, zinc oxide producers kept stable operation, and large-scale plants’ expanded projects have gradually operated at full capacity. Meanwhile, domestic automobile output rose year on year. Data from China Association of Automobile Manufacturers (CAAM) showed that output of passenger vehicles stood at 1.73 million units in July, down 3.9% on the month, but up 13.2% on the year, and sales came in at 1.67 million units, down 5.6% from June, but up 8.5% from a year earlier. The continued recovery of the automobile sector will boost zinc oxide consumption.