Conti expects materials costs to rise

Hanover, Germany – Continental AG has forecast a significant rise in the cost of most tire & rubber product-related feedstocks and materials for this year.

Overall, for 2018, Conti expects a €50-million negative impact due to increases in oil and synthetic rubber prices, the group said in its 2018 half-year results published 2 Aug.

The company had previously forecast effects from raw-material prices to be nearly balanced for the Rubber Group, which comprises the Tire and ContiTech divisions.

With the average price of North Sea Brent crude oil up from $54 per barrel to $71 per barrel in the first half, costs for carbon black and other chemicals are expected to rise by over 10% compared to the average prices in 2017.

For butadiene, the company is increasing its forecast for the average price across the year from $1.51/kg to $1.60/kg.

For natural rubber prices, however, the company expects the average price to be below the previous year’s level, at $1.44/kg, compared to $1.67/kg in 2017.