Tyre exports rebound with 10% growth to cross ₹14k crore in FY21

Our Bureau Updated - July 09, 2021 at 09:20 AM.

Industry credits govt’s sector-specific support for tiding over a tough pandemic year

HYDERABAD (ANDHRA PRADESH/ BL) -- 06-03-2011 --/STAND ALONE PIC / TYRE PRICES ON ALL TIME HIGH : A tyre dealer at Begumbazzar in Hyderabad takes a count of the just arrived stocks on Sunday . While the domestic rubber spot price is at an all all-time high at Rs 242/kg. The price at the international market too shot up to Rs 535 yen/kg . The demand for rubber has escalated following a ramp-up in global auto sales. Excess rainfall, particularly in rubber producing state like Kerala in 2010,have taken a toll on domestic rubber production . Flood conditions in South East Asian countries, which are key rubber producing nations have also hit overall productions. With rubber prices going up, tyre manufacturers have hiked price of its products by four per cent .The average price of the most commonly used natural rubber - the RSS-4 variety - was Rs 50,400 per tonne in 2003-04 and has risen to around Rs 1,70,590 per tonne this fiscal. Rubber Board website estimates that there will be over 85,000 tonne gap between domestic demand and availability of natural rubber in 2011-12. ---PHOTO: P_V_SIVAKUMAR - PHOTO: P_V_SIVAKUMAR .

In one of the most robust export performances in the auto space, tyre exports from India rose 10 per cent in value terms in FY21 to touch ₹14,097 crore, the latest data released by the Ministry of Commerce says. In volume terms, at 3.64 crore units, tyre exports grew 8 per cent.

The strong export performance came on the back of disrupted international trade due to the Covid pandemic and a sharp contraction of 23 per cent in tyre exports in Q1 of FY21. “The spectacular rise in exports of tyres during a challenging year bears testimony to the resilience of the industry to bounce back despite a tough environment,” said Anshuman Singhania, Chairman, Automotive Tyre Manufacturers Association (ATMA).

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Barring a marginal contraction in FY20, tyre exports grew 60 per cent in the last five years, from ₹8,825 crore in FY16 to ₹14,097 crore in FY21.

According to ATMA, the sector-specific interventions by the Government helped the industry increase its export competitiveness. The curbs on indiscriminate import of tyres provided the industry the much-needed stimulus.

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Indian-manufactured tyres are exported to over 170 countries including some of the most discerning markets in North America and Europe. The top five export markets for Indian tyres in FY21 were the US, Germany, France, Italy and the UK. Tyre exports grew in double digits in each of the top-five export markets in FY21. The US continues to be the largest market for Indian tyres, accounting for 17 per cent of tyres exported during the year.

The tyre industry is hopeful of maintaining the tempo in exports despite supply chain-related challenges as both global growth and global merchandise trade volumes are expected to increase in 2021. The tyre industry will continue to target newer markets for exports, ATMA said.

According to ATMA, the industry has the potential to significantly grow exports from India in the next 3-4 years if certain roadblocks, especially over access to natural rubber (NR), are removed. The industry needs to adhere to the pre-import condition for NR import against (tyre) export obligation. This constricts operations and affects exports. ATMA has urged the Government to improve NR availability and quality to increase the sector’s competitiveness.

Published on July 8, 2021 11:27