Indian market is integrated internationally

July 20, 2016

According to Sheela Thomas, Secretary General, Association of Natural Rubber Producing Countries, the crisis in the Indian natural rubber market follows the international trend. An improvement in the domestic prices can be expected only with an increase in international prices, Sheela tells Business Line.

International natural rubber prices continued to fall from 2013 due to various factors. Global economic slowdown particularly in China was a prominent factor among them, which accounts for about 40 per cent of the global demand. Slowdown continues in China and other Asian developing economies although the US, and Euro zone countries are on a recovery path.

A substantial expansion of yielding area during the last couple of years due to large-scale planting undertaken during 2005-2010 has led to fall in the rubber prices internationally. The global supply remains almost stagnant mainly because of the current low prices. The supply is expected to boom once if the prices improve.