Tire rubber raw materials or low-far only partially reduce the risk of rising rubber prices

Tire companies have recently raised prices, but well below the rise of plastic raw materials. As a result, prices only to reduce the tire rubber part of the price risk, and have yet to eliminate the risk of severe ups and downs.

Affected by domestic and foreign supply, the price of rubber-day grid since the beginning of last year's 12,000 yuan to rise by the end of May this year of 30,000 yuan, or a total of 150%. This upstream and downstream industries have had a tremendous impact, rubber farmers and traders to share the prices of rubber huge profits and tire companies have to bear the high prices of raw material costs brought about by the pressure.

Tire industry squeezed by both sides

At present, the rubber-day sharp fluctuations in the price grid, the car tire products on the market, competition is increasingly fierce, resulting in the tire business at the same time faced with the cost of production and marketing of both the price squeeze. On the one hand, it is necessary to fight for control of the upper reaches of the rubber market and lower raw material costs, on the other hand, but also in both the domestic tire market or export market, taking low-cost competition, industry profits were a large number of compression. As a result, the tire market in the context of an over-supply of hard to change, to reduce the risk of fluctuations in the city of plastic, is becoming a tire enterprises to reduce production costs, operating profit lock the main way.

Paul sets of futures markets is a shortcut

At present, the city of Hujiao period of active trading, liquidity significantly enhanced the domestic futures market has become one of the few active in one of the species. Volume compared with the positions, although the positions Hujiao only 5 million in hand, but the daily turnover has reached 20-30 million hand on a larger scale, which is equivalent to 4-6 times the volume on the Shanghai Plastic short-term funds bargain-hunting behind high trading very active.

According to the current domestic demand for rubber consumption of 200-250 million tons, demand for daily consumption of 6-8 tons, the daily turnover of 20-30 million Hujiao hand, that is, 100-150 million tons of terms, the volume Hujiao For the domestic rubber consumption of 125-250 times, so as to participate in the tire business into futures markets have provided favorable places.

At the same time, the city of Hujiao Dongjing Jiao has become a common indicator of global prices, and rubber-producing areas in Southeast Asia and the international and domestic city of Hainan and Yunnan rubber-producing areas the city closely linked. As a result, participation in the city of Hujiao period, not only the completion of hedging, but also are spread through the period, access to arbitrage profits. In addition, the implementation of bond futures trading system, but also for the majority of the tire companies to reduce the scale of capital investment and lower cost of funds to smaller fund size, large-scale control of the cash to buy raw materials risks.

According to the survey, there are considerable number of enterprises through various channels at the same time to participate in international and domestic rubber futures market, the spot market, avoiding the risk of fluctuations in the prices of rubber, as well as some domestic and foreign enterprises and rubber suppliers to sign long-term supply contracts, to avoid the risk of fluctuations in rubber prices . Tire companies also believe that the funds and staff tension, and downstream users to be more fixed and other factors, enterprises have not yet led to effective hedging instruments. In this regard, I believe that a correct understanding of the tire business should be involved in the futures market to hedge their plastic to avoid the risk of the importance of the city.

In fact, a view not to participate in the city of hedging, will have a direct spot rubber prices in the face of fluctuations in the market risk and price risk, and to participate in the futures market hedging, the tire companies to reduce the risk of rubber futures prices and spot prices of rubber Between changes in the price of risk. Futures markets not only for the tire business provides a wide range of channels for procurement of raw materials, and tire companies for the procurement of long-term target price of raw materials. Tire companies should be the appropriate size of the investment funds and staff, participate actively in the futures market hedging, only this can be severe fluctuations in the prices of rubber, smooth access to the operating profit.

For the lower reaches of the domestic commodity processing enterprises and end-consumer business, as the majority of finished goods market is still in a buyer's market over-supply situation, prices of finished goods and raw materials prices have still not smooth conduction characteristics and therefore rely solely on raw materials increase the prices of finished goods, Not only severely limited price increases, and price increases faced by direct sale to reduce the size of the risk.

As a result, only an active part in the futures market, buying for hedging, will be able to fully and effectively to avoid sharp fluctuations in commodity prices caused by market risk. This downstream processing of bulk commodities and consumer business has a universal significance.

To sum up, tire companies raised tire prices, only part of the day on the Elimination of rubber raw materials prices rose grid risks involved in the futures market to try to buy hedge to the price of rubber in the days of sharp fluctuations in the grid, operating improving the situation in the In an invincible position in the market.