Imports on the rise

Natural rubber imports in India stood at 47,193 tonne as of Wednesday, according to provisional estimate, beating Rubber Board's projection of 45,000 tonne for 2006-07 (April-March), an official of the board said today.

Domestic rates staying higher than global prices since October is the main reason for imports rising 14 per cent, compared with same period a year ago, he said.

Domestic user industry had inked contracts during the last two months for large import consignments when prices were down overseas, compared with domestic rates, he said. "These orders are now getting executed and imports may reach the level of 60,000 tonne by March," he added.

Automotive Tyre Manufacturers Association, an apex body of tyre makers, has projected 30,000 tonne rubber imports during January-February. Imports mostly are due to orders placed in November-December, as new orders are unlikely because the gap between domestic and global prices narrowed down to less than Rs 2 a kg on Friday, a dealer said.

Average prices in India were higher by Rs 10 a kg two months ago, compared with global prices, he said.

Rubber Board projected 45,000 tonne imports in 2006-07, when Indian prices were down compared with global rates, dealers said.

Rubber Board's projection looked right when imports in April-September fell 31 per cent to 24,910 tonne, compared with 32,403 tonne in same period a year ago, they said.

A reversal took place from October, when domestic prices started moving up, compared with global rates, and the gap between the two reached more than Rs 10 a kg.

The situation has changed again with the firm trend returning to Bangkok market in last few days, a dealer said. Benchmark RSS-3 grade in Bangkok, equivalent to domestic RSS-4, was at Rs 94.94 a kg on Friday, compared with domestic price of Rs 96.50.

Natural rubber exports topped Rubber Board's projection of 50,000 tonne for 2006-07, at 51,309 tonne as of Wednesday.