A dip in domestic production of Rubber leaves tyre manufacturers looking at imports.
As there is a dip in domestic production and boost in demand, now Indian tyre manufacturers are vigorously eyeing on the supply of natural rubber from South-East Asian manufacturers.
The supply gap in natural rubber is likely to increase because of declining production in Kerala, as there is no chance left to expand the rubber plantation area there, said Lakshmi Nair, Head of economics and statistics at the International Rubber Study Group. Nair also added that, “currently, India imports 50% more than its actual requirement and further, the chances are higher that Indian rubber industries will be more dependent on import and, with this growing needs for natural rubber, International and Indian tyre industries are probably to stand in futures trades following the rising gap between demand and supply”.
However, most Indian tyre industries have been in touch with South-East Asian rubber producers to shelter the supply, they have already opened offices in Singapore’s global trading hub, where there are major producers available. But for synthetic rubber, the loss is going to be the same even though there is higher domestic production.