Natural rubber hits record ₹290/kg, lifting costs for tyre buyers

Domestic natural rubber reached a record ₹290 per kg for the RSS-IV grade, BusinessLine reported on October 22, as tyre makers bought heavily and supplies stayed tight¹. The report said Indian prices were ruling about ₹20 per kg above international levels, with Bangkok at around ₹270 per kg¹.

Block rubber was at ₹273 per kg in India against about ₹245 internationally, the report said¹. India is the world's third-largest producer and fourth-largest consumer of rubber³. The report did not give a year-earlier price for comparison.

Supply has not kept up

Imports of natural rubber and compound rubber have stayed high. They average around 75,000 tonnes a month, according to George Valy, president of the Indian Rubber Dealers Federation, who was quoted in the report¹. He said availability had not improved to the extent expected even though tapping has continued¹.

Growers are switching what they produce. Latex was quoted at ₹300 per kg and cup lump, the coagulated scrap collected during tapping, at ₹200 per kg¹. Those prices have drawn growers away from sheet rubber, deepening the shortage of sheets, the report said¹.

Synthetic rubber has become more expensive too. Harish MV of Harnez Fin Analysis attributed the rally largely to the West Asian conflict¹. Higher Brent crude prices lift the cost of making synthetic rubber, so manufacturers use more natural rubber instead, he said¹. Brent spot was $115.22 a barrel on October 20, up 89.8% from a year earlier².

Harish also said unusually hot weather cut latex output in southern growing areas, and that Indian auto demand ran ahead of local supply¹.

What it means for buyers

For companies buying tyres, retreads, belts, hoses, footwear, gloves or moulded parts, the domestic benchmark for sheet rubber is now ₹290 per kg and block rubber ₹273 per kg¹. The ₹20 per kg gap between Indian and overseas prices matters most to buyers able to import, and to suppliers who set prices against domestic sheet rubber¹.

Tyre makers are the largest buyers of Indian sheet rubber. Their offtake is what dealers cite as the reason domestic prices are holding above overseas levels¹.

The Rubber Board, the statutory body under the commerce and industry ministry that collects rubber statistics, is headquartered in Kottayam⁴. It also advises the government on imports and exports of rubber⁴.

Outlook

Growers expect the northeast monsoon to bring rain to the main rubber growing areas, which is expected to support yields and improve availability, Valy said¹.

Harish said prices are likely to stay firm near ₹300 in the near term while weather risks persist, though rising seasonal supply and weak demand outside Asia may limit further gains¹. Chinese buyers turned more cautious after prices rose in August, which capped the market, he said¹.

What to watch

• The Rubber Board's published RSS-IV and block rubber prices, which the trade uses as its reference⁴.
• Monthly import volumes of natural and compound rubber, now running at about 75,000 tonnes¹.
• Price announcements from tyre makers as they pass raw material costs on to vehicle makers and fleets¹.
• Rain in Kerala and nearby growing areas as the northeast monsoon sets in¹.