• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Brand Quest
• The New Manager
• Smartbuy

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth
• Events 2007

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Our Bureau

Kochi, Aug. 17 The share of the tyre sector in natural rubber consumption is likely to increase further vis-À-vis the non-tyre sector in the coming years, Mr Rajiv Budhraja, Director General of Automotive Tyre Manufacturers Association (ATMA), has said.

In a presentation at India Rubber Summit and Dinner 2008 in Kochi, he pointed out that the consumption of natural rubber by the tyre sector has been consistently increasing and the sector currently consumes 57 per cent of natural rubber produced in India.

However, Mr Budhraja expressed the industry’s concern over demand-supply imbalances and severe price volatility in case of natural rubber in India, which might spur the industry to depend more on external sources in the years to come.

He said that a delicate balance exists between domestic production and consumption, which is expected to put further pressure on natural rubber availability, while resulting in price fluctuations. Currently, domestic natural rubber prices are ruling higher than international prices and even at high prices, the availability of natural rubber is a major concern with rubber consuming industries.

In the current ranking, India is the fourth largest producer as well as fourth largest consumer of natural rubber in the world. There is a need for natural rubber producing and consuming interests to grow in tandem for long-term sustainability, he said.

Unfortunately, as revealed by an analysis by ATMA, India’s share in natural rubber re-plantations in South Asia is fast declining and a precarious situation might await rubber using industries regarding long-term natural rubber availability, if immediate steps are not taken. India’s share in natural rubber re-plantation in South Asia came down to one third of what it was in 2004.

While, India’s share in total natural rubber planted area in South East Asia continues to be 7.5 per cent, its share in natural rubber replanting has come down from more than 10 per cent in 2004 to 3.6 per cent in 2007.

For its analysis, ATMA studied the natural rubber plantation and re-plantation pattern in six countries in South East Asia — Thailand, Malaysia, India, Indonesia, Vietnam and Sri Lanka.

ATMA has attributed the decline in re-plantation momentum to an unprecedented rise in the natural rubber prices in the recent times. There has been a steep 65 per cent increase in prices of natural rubber over the last one year. From Rs 85 a kg in September 2007, the prices are currently ruling at Rs 140 a kg, he said.

In the recent past, hike in natural rubber prices have been directly or indirectly linked to increase in crude prices.

Although the crude prices have fallen significantly in the recent past, there is no corresponding reduction in natural rubber prices, he said.

More Stories on : Tyres | Rubber

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Copyright © 2008, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line