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RUSSIA
Belarus Considers Increasing Import Duties on Retreaded Tyres
The Belarusian State Concern ‘Belneftekhim’ has requested that the government increases tariffs on tyres imported into the country, with the possibility of expanding this measure to the territory of the Eurasian Economic Union (EEU), which also includes Russia and Kazakhstan.
The last time the Commission of the Customs Union, which involves the same countries, increased import duties on retreaded and used tyres in 2010, they were tripled to 20 per cent. However, market participants currently claim that this figure is too low to protect the domestic Belarusian producers from import supplies.
However, if five years ago the Customs Union increased import duties in a bid to limit supplies from Europe, the main threats to the national producers now are the Asian tyre manufacturers. With imports of retreaded tyres accounting for about half of the Russian market, and 40 per cent of the Belarusian market, the share of Asian producers is still low and only amounts to between 11 per cent and 14 per cent of total supplies, according to the analysts estimations. However, this figure has been rapidly growing in recent months as Asian tyres replace supplies from European producers. "Belneftekhim asked the relevant intergovernmental bodies to consider this issue in the near future" – stated the company’s CEO Igor Bobyrev. “For Belarusian and Russian producers today it is becoming more difficult to operate due to increasing competition from companies from South-East Asia, which have a number of competitive advantages, including the price of rubber”.
In the autumn of 2014 the Eurasian Economic Commission started an anti-dumping investigation against Chinese producers of tyres for trucks, buses and trailers. The investigation was initiated at the request of several companies including Belshina, Omskshina, Yaroslavl Tyre Plant, Nizhnekamskshina, Nizhnekamsk truck tyre plant and Nizhnekamsk Tyre Factory. The last three companies are part of the holding "Tatneft-Petrochem".
Chinese producers already have a strong presence in the market for new truck tyres in the EEU. According to official information from the Federal Customs Service of Russia and Custom Body of Belarus, total imports of truck tyres in the countries of the Customs Union in 2012-13 grew by 29.8 per cent, while imports from China during the corresponding period increased by
36.3 per cent, so its share reached 64 per cent.
As a result in the period from 2011 to 2013 the sale of truck tyres in the Customs Union countries increased by 5.1 per cent, while production fell by 9.2 per cent. The share of tyres produced in the Customs Union in the total structure of supplies dropped by 11.1 per cent. It has been reported that to compete with cheap Chinese tyres manufacturers the tyre producers of Russia, Belarus and Kazakhstan were forced to reduce prices.
Currently the
share of Chinese
and other Asian
manufacturers is
growing also in
the segment of
retreaded tyres,
especially for
trucks. The
request of
Belneftekhim does not specify what level of import duties the company consider as appropriate. However, if anti-dumping investigations really find that Chinese manufacturers
pose a threat to the tyre producers and retreaded businesses of Customs Union, then duties could be raised to about 30 per cent.