ERJ staff report (BC)
Mumbai, India – Natural rubber imports by India, the world’s third-biggest user, are poised to drop for the first time in five years from a record as declining car sales crimp reduce demand for tire rubber, reports Swansy Afonso of Bloomberg.
Inbound shipments are estimated to drop 17 percent to 180 000 tonnes in the year that started April 1 from an all-time high of 217 364 tonnes a year earlier, Sheela Thomas, chairman of the Rubber Board of India, is reported to have said. The biggest slump in car sales since 2001 last year boosted local rubber stockpiles by 13 percent to 266 000 tonnes, and will make up for a domestic shortfall in supplies, she said.
Reduced demand from India may accelerate a decline in futures in Tokyo, which have lost about 9 percent this year and entered a bear market in April on signs that weak demand from China, the largest user, will expand a global glut. A drop in prices may help lower costs for tire companies including MRF Ltd. (MRF), Apollo Tyres Ltd. (APTY) and Bridgestone Corp.
“The slowdown in auto sector would definitely adversely affect domestic consumption of natural rubber as 65 percent of the consumption is accounted by the sector,” Thomas is quoted as saying.
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