Global Tire Supply Crisis Continues

The global crisis for the supply of earthmover (EM) tyres, that started in late 2003/early 2004, continues.

Otraco predicts that the shortfall in global supply compared with demand will get worse before it gets better. Mining equipment sales are at record levels and the commodity boom remains in full swing (for the moment).

Supply shortages for large EM tyres (51" to 63") will worsen during 2007 and 2008, before easing with the planned production increases from Bridgestone and Michelin in mid to late 2008. Supply for smaller sizes (up to 49") should ease early in 2008 when Michelin's new Campo Grande production facility in Brazil comes on line.

Depending on global commodity demand over the next few years, we could well see a shortfall in EM tyre supply compared with demand through and beyond 2010.