Natural rubber prices crashed last week on concerns of excess supply and lower demand. While a drop in global prices has made imports attractive despite rupee depreciation, tyre companies are worried over the sluggish demand in the automobile sector.
International prices of sheet rubber RSS 3, used by tyre companies, fell by Rs 12 in seven days ended June 8 to Rs 190 per kg. The price of block rubber SMR 20 too crashed by over Rs 20 to Rs 154 per kg in the global market, leading to a huge difference of Rs 36 between sheet and block rubber, which may prompt Indian tyre makers to import bigger volumes of block rubber.