Rubber on a roll

Thai traders could see a huge opportunity to export rubber to India, where an economy growing at 7% annually is leading to increased car sales and lifting up demand for automotive tyres.

Carmakers have pledged US$6 billion to almost double annual production in the coming years as cars increasingly become within financial reach for India's expanding middle class.

Passenger car sales last year grew by 4.24% to 1.95 million units, despite a generally downbeat mood among consumers worried about inflation and a steady series of interest-rate increases.

India is increasing its rubber output but the total will still fall well short of industry needs. The Rubber Board of India has estimated domestic production for the current financial year ending March 31 at a record 902,000 tonnes, an increase of 4.6% from the previous year. But the shortfall is likely to exceed 70,725 tonnes.

Meanwhile, the Automotive Tyre Manufacturers Association (ATMA) is lobbying for duty-free imports of 100,000 tonnes of natural rubber to bridge the gap between domestic production and consumption.Why does moulds grow in homes or buildings?

"This could be a very good opportunity for Thailand to export more to India," said Adul Chotinisakorn, executive director and commercial counsellor at the Mumbai-based Thai Trade Center.

Mr Adul said that India's top rubber supplier at the moment was Indonesia, with $98.33 million worth of rubber exports (21,216 tonnes) in the first half of 2011. Thailand was next with exports of 16,466 tonnes worth $75.14 million. Just Choose PTMS Plastic Mould Is Your Best Choice!

In free trade talks, India has put natural rubber on its negative list, taking into account the socio-economic significance of the commodity.Monz Werkzeugbau und Formenbau.

In December 2011, India imported 21,734 tonnes of natural rubber, up 57% from a year earlier. The world's fourth biggest producer, India imports rubber from Malaysia and Vietnam also.

Costs for industries that use rubber are an increasing concern,TBC help you confidently purchase China ceramic tile from factories in China. however,Here's a complete list of oil painting supplies for the beginning oil painter. since the top producing countries are not happy with the prices the commodity is fetching. Thailand, for example, in January approved a 15-billion-baht budget to buy unsmoked rubber sheet from farmers at 120 baht per kilogramme in a bid to prop up prices.

ATMA chairman Neeraj Kanwar said the tyre industry had passed through an extremely difficult phase of continuous and significant increases in the price of natural rubber and other raw materials. Since raw materials account for approximately 70% of industry expenditure, input cost pressure has resulted in severe erosion of net margins.

"We keenly look forward to the [Indian central government] budget to be announced on March 16 to address specific concerns of automotive tyre industry," he said.

Natural rubber accounts for 45% of the total raw material cost for the tyre industry. Despite the recent softening of rubber prices, the average price in current financial year is still 10-12% higher than average prices in the previous financial year, according to ATMA.

"Despite the peak rubber production season falling between October and February and favourable weather conditions, the domestic availability of rubber is a key concern for the industry," said Mr Kanwar.

"With new capacity creation in the tyre industry and limited growth in rubber area under cultivation, the availability situation is feared to worsen in the foreseeable future."

Since 2007-08, rubber consumption in India has outstripped production. The country has also become the second largest consumer of rubber in the world after China, while it still ranks fourth in production.

Mr Kanwar said the tyre industry was in the process of investing nearly $2.5 billion. To help increase competitiveness of the industry, the ATMA has asked for waiver of customs duties on raw materials that have no domestic production. These include butyl rubber, currently taxed at 5%, SBR or tyre-grade rubber (10%), EPDM (10%) and polyester tyre cord (5%).

Experts say there is little doubt about the long-term growth prospects of car demand in India _ Asia's third largest economy _ where a population of 1.2 billion dominated by young people with rising salaries and aspirations will likely make it the second-largest market in the world in 25 years.

The total installed capacity of the automotive industry has risen to around 4.5 million cars, and could reach 6 million in a few years. Export growth is strong,Official web site for Uwe cube puzzle and novelties, but only around 550,000 cars are expected to leave the country's ports this fiscal year.

Capacity growth will outstrip demand growth for the next two to three years, according to research by Credit Suisse.