ATMA, Auto News, ET Auto
The Automobile Tire Manufacturers Association (ATMA) on Tuesday asked the government to allow free imports of natural rubber to the extent of a projected supply-demand gap of 4.4 lakh tonnes. The domestic deficit for fiscal 22, which was expected to account for 45 percent of production at 3.4 lakh metric tons (MT) at the start of the year, is now expected to reach 55 percent of production at a “massive” level. . 4.4 lakh MT, ATMA said citing figures from the Rubber Board of India. In a letter to the Union Minister of Trade and Industry highlighting the situation, ATMA said: âA severe shortage of NR (natural rubber) is negatively disrupting production processes in tire manufacturing units, even as demand for tires peaks.
Stating that the NR shortage at the height of the peak production season in Kerala is unprecedented, ATMA said that does not bode well for the tire industry value chain.
“Compared to the average national production of around 75,000 MT each during the months of October and November, it should not exceed 45,000 to 50,000 MT each in October and November of the current year “, he added.
Consumption, on the other hand, is expected to remain at over 1 lakh MT each during these two months, with a resulting deficit of 1 lakh MT over a short two month period of the current peak production season. which is of major concern to the tire industry. which consumes nearly 75 percent of the total NR produced in the country, ATMA said in its letter to the ministry.
ATMA, Managing Director Rajiv Budhraja, said the shortage comes at a time when domestic production of commercial vehicles (CVs) is improving after a prolonged downturn.
Tires for trucks and buses (T&B) have a relatively higher NR content. Demand for NR should therefore strengthen further, but the availability crisis is likely to take a peek in the works, he added.
“In order to ensure that the production and exports of tires proceed uninterruptedly, duty-free imports of NR should be allowed to the extent of the gap between demand and supply expected in the country, that is, ie 4.4 lakh MT, “said ATMA.
The duty-free import volumes can be revised every year, as a tariff quota (TRQ) quantity, in accordance with production and consumption estimates made by the Rubber Board, he added.
The tire makers’ body also sought to allay concerns that the import of NR is greater than the deficit, causing downward pressure on domestic prices and asserted that imports of NR by the tire industry. tires were intended only to fill the domestic deficit, as the import figures match the deficit figures. .
âAs domestic availability has improved, the import of NR by the tire industry has been reduced,â ATMA said.