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Bridgestone Not Shelving Firm for Mining Plant Tyres

(MmegiOnline) Amid all the gloom caused by plummeting diamond sales, job losses, production cuts and outright mine closures this week, Bridgestone is going ahead with its plans to construct a plant to produce large and ultra-large radial tyres for mining trucks, which have been in short supply for years.

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Tyre shortages have dogged the mining industry for the past five years. The tyres are especially indispensable in opencast mining, hence Debswana, which operates four such mines, was hit hard by the shortage and experienced production delays.

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Only two tyre makers in the world, Bridgestone of Japan and Michelin of France, have plants that produce reliable heavy plant tyres and have been the major suppliers to the diamond mining company.

In a recent tour of one of Bridgestone’s plants in Farouche, a city in the west of Japan, the management of the company told Business Today that they have no intention to shelve plans to construct a second plant specialising in such tyres despite the global economic downturn.

"We are aware of the tyre shortages and we hope to meet that demand as soon as the new plant is completed," Amangi Plant Quality Assurance Manager Eiji Taniguchi said recently.

Taniguchi said the plant, which is being built in Kitakyushu, is scheduled for completion in 2010. "We have one factory specialising in such tyres, but it is not enough," Taniguchi said. "That is why we are constructing a second one.

"It is the first time in more than 30 years that Bridgestone is building a new tyre plant in Japan.” The company will also increase its capacity for the production of mining steel cords and construction vehicle tyres at the Saga Plant to support this new plant. In 2006, the estimated budget for both projects was in the region of ´32 billion.

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Worldwide, tyre shortages – especially for 240-tonne trucks – affected the mining industry as demand outstripped supply during the boom in commodity prices when some previously unoperational mines and new junior miners came on stream.

This often resulted in production delays at Debswana’s mines as several trucks were grounded. Botswana’s mining parastatal had to supplement with more expensive but shorter lifespan tyres from China. Tyres made by Bridgestone and Michelin last longer as they are reinforced with steel, compared to China’s bias ply tyres that are reinforced with rope.

The boom in the mining sector that was attributed to exponential demand growth in both China and India has since slumped as the effects of the global recession tightened.

This week, Debswana like other miners around the world, will shut down two of its mines in Orapa and Damtshaa for the rest of 2009. The other mines, Letlhakane, Orapa No.1 Plant and Jwaneng Mine, will remain closed until April 14.

Taniguchi, however, said because the Bridgestone plant will be completed by 2010, there is optimism that the global economy will have recovered and demand for commodities risen by that time.

Tyremakers, Bridgestone included, have not been spared the economic downturn as figures released on Wednesday show that the demand for cars in Japan, the primary source of tyres, dropped by 69% in January. (Tire Review/Akron)

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