As the market stabilises, more and more funds have begun to focus on tapping stocks that are expected to increase substantially in the future. The rubber industry stocks that will benefit from the declining prices of raw materials and continued strong downstream demand have obviously paid attention to funds in the near future. Zhongding shares, Baotong belt industry and other varieties have signs of long-term low capital positions.

Raw material prices are expected to have low strengths. For the rubber industry, there are mainly supporting raw material industries such as tire industry, hose industry, and carbon black. These rubber products are widely used in industry, agriculture, transportation, aerospace and daily life. In recent years, China's rubber industry has developed rapidly along with domestic economic growth, and has become a major producer of rubber products. Among them, the output of various products ranks first in the world and ranks first in the world for the consumption of natural rubber for many years. Therefore, the price of natural rubber will affect the profitability of China's rubber industry.

In previous years, due to the strong demand for natural rubber in China, the price of natural rubber continued to increase, and the profitability of China's tire industry declined. However, due to the continuous high prices of natural rubber, Southeast Asian countries have increased their efforts to plant natural rubber. According to statistics, the nine countries represented by Malaysia had a new planting area of ​​500,000 mu in 2003 and reached 3.5 million mu by 2008. Since the growth period of natural rubber is 7 years, the natural rubber planted in 2003 began to enter the harvesting period in 2010. Therefore, after 2010, the price of natural rubber began to drop at a high level. At present, there are only 270 US dollars/ton, the higher point. The $540/ton dropped by 50%. Moreover, this also shows that natural rubber prices will hardly rise in the next few years. After all, the new 3.5 million mu in 2008 will also begin to enter the harvest period in 2015.

The data shows that natural rubber accounts for the higher cost of related rubber products. Taking tires as an example, natural rubber accounts for about 30% of the total cost of tires. As for Aeolus, natural rubber accounts for 37% of the cost of raw materials, and synthetic rubber accounts for a slightly lower ratio of 17%. Therefore, the substantial drop in natural rubber prices will greatly ease the pressure on the tire industry. Similarly, in the conveyor belt area, the main raw material for the product is rubber, of which Shuangjian’s share of natural rubber accounts for 37% of the cost of raw materials in 2007. For this reason, the drop in the price of natural rubber is beneficial to the profitability of all rubber products companies.

Downstream demand supports product prices However, there are also industry insiders worried that the decline in raw material prices will also drive down the price of end products. From the perspective of industry, there is indeed such logic. However, in the rubber products industry, the possibility of a sharp drop in product prices is not significant. This is not only due to the use of most high-end products such as rubber seals. Due to the high technical barriers, there are not many enterprises that can enter the market. The pressure of price drop is not great; but also due to strong downstream demand, raised the expectation of high prices of products. Among them, taking automobile tires as an example, China’s car ownership has exceeded the 100 million mark at present, and industry insiders estimate that it will exceed 200 million in the next 10 years. The substantial increase in car ownership will greatly boost the demand for tire replacement, which is the main market for domestic tire companies.

In terms of per capita occupancy, China now has one car for every 13 people, and every two people in France owns one car. We are still far below the level of developed countries. The future automobile industry still has a lot of room for development, which means that The demand for the automotive tire industry will continue. And the development of the automotive industry also has a strong demand for rubber seals and other products.

At the same time, 50% of the conveyor belt industry products are used in coal mines. According to industrial planning, the country will continue to integrate resources for coal production bases, develop large-scale production bases and cultivate large-scale enterprise groups to achieve centralized coal production and optimal allocation of resources. The coal industry's production capacity will be concentrated on large and medium-sized coal enterprises and will increase The demand for conveyor belts. From this we can see that the market demand of related stocks such as Baotong Belt Industry is still optimistic.

Looking at opportunities from technology and demand, it can be inferred that the future profitability expectations of the rubber industry have been greatly improved, and the long-term low capital position is also expected. Based on this, in the operation, it is recommended that investors can also track the rubber industrial chain shares. Among them, Hainan rubber used for producing raw material products is subject to price slumps and should be cautious. However, for the downstream stocks, they can actively focus on technical thresholds and downstream requirements, such as Fengshen shares, Baotong tapes, Zhongding shares, Shuangjian shares and Sanlux.