China, US target markets for rubber machinery producers

London – The international rubber machinery market has grown by around 10 percent – based on data from machinery companies that supplied figures for the ERJ Machinery Survey both in 2015 and 2014.

Comparing the results for companies who replied both years the total sales recorded by the survey reached $3,585.1 million up 10.3 percent from the equivalent total of the previous year.

The grand total of 2014 sales from all survey respondents came to $3689.3 million, which was 13.1 percent higher than the prior-year grand total.

The robust year-on-year growth recorded sales suggests continued momentum in the market for, at least, most of 2014.

Negative market factors, such as the Ukraine crisis and its impact on sales on Russia and the US imposition of tariffs on tire imports from China, have, it seems, yet to bite fully. Marked declines in sales at several Chinese machinery companies could, however, be a sign of things to come.

On the other hand, China was identified as the most buoyant market - being listed, along with North America, by 48 percent of respondents as strongest growth regions for business in 2014.

Not far behind was Central and Eastern Europe, which was selected by 44 percent, though the continuing economic woes in the EU were reflected in a marked decline in those including Western Europe as a strong-sales region.

Machinery makers benefited from the strength of the tire and automotive industries, with over half of replies identifying these as sectors that were performing well. The increased positivity from these sectors also extended to suppliers of general rubber goods.

The uncertainty is feeding through to investment plans with 44 percent of respondents planning to expand their operations compared to 61 percent a year ago. There is a better flow of new-build projects coming through the pipeline, perhaps reflecting the market vagaries that often occur in the time between the sanctioning investments and them coming on-stream.

From a European perspective, the results of the ERJ Machinery Survey 2015 tally with viewpoints issued by Assocomaplast in December. The Italian industry association then reported that the export market – the traditional driver for Italian manufacturers of plastics and rubber processing machinery – had lost some of its momentum in recent months.

Despite a 4-percent rise in exports in January-September of 2014, compared with data for the same period in 2013, Assocomaplast envisaged a year-end balance substantially in line with that of 2013.

This mirrored the economic analysis in Germany, where production forecasts were now running well below the previously forecast levels of around 3 percent. This has been linked to a drop in demand from important markets such as Russian, Brazil, China and India.

Meanwhile, German trade body, the VDMA has predicted sales of German plastics and rubber processing machinery to come in at €6.7 billion for 2014 – just below last year’s record.

However, while domestic orders were up 20 percent in the first eight months of last year, exports were 3 percent lower, the group reported.

“German deliveries abroad have decelerated sharply, falling by 5.3 percent in the first half of the year,” said Thorsten Kühmann, the VDMA’s managing director.

“The export picture is dominated by negative trends in demand from and exports to Brazil, Russia, India as well as Turkey and Mexico. China, too, is weakening.”

(Image source: Marangoni)

This article was originally published in ERJ's March/April issue.