Automotive component makers are taking positions in India’s auto industry, which is growing at about 10% a year and would grow by 10 to 12% a year for the next two years. During the month two deals were announced, Germany’s Continental acquired the tyre business of Modi Rubber and US based Dana Corporation said it had agreed to buy the drive-head unit of Axles India, a joint venture between Dana and two Indian companies – Sundaram Finance and Wheels India. The deal is expected to close in the second half of the year.
Overseas interest in India’s auto market could be driven by strong consumer fundamentals as well as its existing low car market penetration of 12 cars per 1,000 people as compared to China at 21 and US at 500. The future buyers could show interest in India’s low-cost manufacturing base from where they could export their products to South East Asian region.
On the other hand the rubber industry has proposed to the government to provide a one time subsidy of Rs 1 lakh per hectare to small farmers for a period of three years for planting rubber trees, in the 12th Five-Year Plan (2012-17) to boost natural rubber output. At present the government is providing a subsidy of Rs 19,500 per hectare on rubber cultivation in the traditional areas and Rs 30,000 per hectare in non-traditional areas. The rubber producers said that hefty subsidy would help increase rubber production in newer areas like the northeastern states.
The rubber industry has also suggested the government to expand the country's rubber output by following the Chinese model of acquiring land in other countries for plantation, to meet its growing natural rubber demand.
Read lot more in Rubber4U – 1st May 2011 issue
Tuesday, April 26, 2011
Thursday, April 21, 2011
SBR price may surge on tighty supply
Styrene Butadiene Rubber (SBR) prices have risen above $4,000/tonne and are likely to remain firm in the second quarter because of tight supply, said an India based tyre producer.
In Japan, a number of SBR plants have shut operations or cut production in the wake of the massive 9.0 magnitude earthquake and tsunami that struck on 11th March 2011. The shortfall in SBR supply in Japan has prompted other Asian producers to step in to provide the material, shaving the volumes available for India and on the other hand to meet the shortfall in the Japanese market, Korean SBR producers have reduced their volume offers to India.
According an India based trader, SBR market is turning more bullish as there is no spot cargo from Europe because of the tight butadiene supply in Europe.
Read lot more in Rubber4U – 1st May 2011 issue
In Japan, a number of SBR plants have shut operations or cut production in the wake of the massive 9.0 magnitude earthquake and tsunami that struck on 11th March 2011. The shortfall in SBR supply in Japan has prompted other Asian producers to step in to provide the material, shaving the volumes available for India and on the other hand to meet the shortfall in the Japanese market, Korean SBR producers have reduced their volume offers to India.
According an India based trader, SBR market is turning more bullish as there is no spot cargo from Europe because of the tight butadiene supply in Europe.
Read lot more in Rubber4U – 1st May 2011 issue
Tuesday, April 19, 2011
Rubber prices likely to remain low during the week
On 18th April 2011, the domestic NR price (RSS4 grade) closed at Rs. 239 per kg at Kottayam and Rs. 261.94 per kg (RSS3 grade) at Bangkok, on weak sentiment. Natural rubber prices may fall due to fall in rates in global physical and future markets.
According to Rubber Board of India, natural rubber production in the country rose to 8,61,950 tonnes in 2010-11, an increase of 3.67% against 8,31,400 tonnes in 2009-10.
The board has projected NR production at 9,02,000 tonnes and consumption at 9,77,000 tonnes during 2011-12.
Read lot more in Rubber4U – 15th April 2011 issue
According to Rubber Board of India, natural rubber production in the country rose to 8,61,950 tonnes in 2010-11, an increase of 3.67% against 8,31,400 tonnes in 2009-10.
The board has projected NR production at 9,02,000 tonnes and consumption at 9,77,000 tonnes during 2011-12.
Read lot more in Rubber4U – 15th April 2011 issue
Thursday, April 14, 2011
Consuming industry wants random inspection of imported NR to be stopped
All India Rubber Industries Association (AIRIA) and Automotive Tyre Manufacturers Association (ATMA), want the Rubber Board to stop random inspection of imported natural rubber.
In a communication to the Union Government, the natural rubber consuming industries have said that due to high NR prices, rubber consuming companies import natural rubber in quantities just sufficient to meet the current requirements, the practice being part of prudent stock management. But they pointed out that any delay in clearance of imported consignments would disrupt the entire production process and could lead to delay in their export commitments. However, the consuming industries were also quick to point out that the rejection rate of imported rubber on quality grounds by Rubber Board officials was less than 1%.
The provision of random inspection of imported natural rubber by the Rubber Board was introduced in December 2004 to check if the imported rubber met the quality requirements.
The decision of inspection of imports should be left to the importer, because industries imports natural rubber at high prices, hence industries can not take the risk of buying natural rubber which does not meet the quality requirements as that would be a drain on their financial resources.
Natural rubber is a raw material and not an item for human consumption. It is a raw material which has to go through a long process of manufacturing to make end products. As the user industries are extra cautious that the imported rubber is of high quality. Hence, it is important that quality standards are followed for the finished products and not for the raw materials.
Read lot more in Rubber4U – 15th April 2011 issue
In a communication to the Union Government, the natural rubber consuming industries have said that due to high NR prices, rubber consuming companies import natural rubber in quantities just sufficient to meet the current requirements, the practice being part of prudent stock management. But they pointed out that any delay in clearance of imported consignments would disrupt the entire production process and could lead to delay in their export commitments. However, the consuming industries were also quick to point out that the rejection rate of imported rubber on quality grounds by Rubber Board officials was less than 1%.
The provision of random inspection of imported natural rubber by the Rubber Board was introduced in December 2004 to check if the imported rubber met the quality requirements.
The decision of inspection of imports should be left to the importer, because industries imports natural rubber at high prices, hence industries can not take the risk of buying natural rubber which does not meet the quality requirements as that would be a drain on their financial resources.
Natural rubber is a raw material and not an item for human consumption. It is a raw material which has to go through a long process of manufacturing to make end products. As the user industries are extra cautious that the imported rubber is of high quality. Hence, it is important that quality standards are followed for the finished products and not for the raw materials.
Read lot more in Rubber4U – 15th April 2011 issue
Tuesday, April 5, 2011
Rubber at all time high & import may be cheaper
Natural rubber prices have been rising in the domestic and international markets due to news of floods and mudslides in Thailand, which will affect the rubber supply in the markets. Natural rubber today jumped to a all time high price and closed at Rs 243 per kg. at Kottayam, largely on the back of strong global cues.
Kerala has been witnessing summer rains which indicates that tapping would continue and more rubber would be produced, but the farmers are not bringing all their produce to the markets in anticipation that the prices would rise further.
The applicable import duty of Rs 20 a kg or 20%, whichever is lower, will lead to significant cost savings for the domestic rubber goods manufacturing industries and also would help in improving the availability of raw material in the market. The rubber (RSS3 grade) price at Bangkok closed at 266.13 a kg.
Read lot more in Rubber4U – 15th April 2011 issue
Kerala has been witnessing summer rains which indicates that tapping would continue and more rubber would be produced, but the farmers are not bringing all their produce to the markets in anticipation that the prices would rise further.
The applicable import duty of Rs 20 a kg or 20%, whichever is lower, will lead to significant cost savings for the domestic rubber goods manufacturing industries and also would help in improving the availability of raw material in the market. The rubber (RSS3 grade) price at Bangkok closed at 266.13 a kg.
Read lot more in Rubber4U – 15th April 2011 issue
Monday, April 4, 2011
Rubber price at its peak once again
Rubber prices made a glorious rebound on strong demand and sharp gains in domestic and international markets. According to industry experts, prices are set to break current records to create another historic high shortly. Rubber grade RSS4 closed at Rs 240/- a kg. at Kottayam and at Bangkok RSS3 grade closed at 258.08 a kg.
Increase in oil prices has lead to rise in the cost of synthetic rubber, substitute of natural rubber. The floods in Thailand, the world’s largest natural rubber producer have disrupted output over the past week. As on 1st April, natural rubber inventories monitored by the Shanghai Futures Exchange fell for an eighth week, losing 5,587 tonnes to 27,611 tonnes, based on a survey of 10 warehouses in Shanghai, Shandong, Yunnan, Hainan and Tianjin.
Read lot more in Rubber4U – 15th April 2011 issue
Increase in oil prices has lead to rise in the cost of synthetic rubber, substitute of natural rubber. The floods in Thailand, the world’s largest natural rubber producer have disrupted output over the past week. As on 1st April, natural rubber inventories monitored by the Shanghai Futures Exchange fell for an eighth week, losing 5,587 tonnes to 27,611 tonnes, based on a survey of 10 warehouses in Shanghai, Shandong, Yunnan, Hainan and Tianjin.
Read lot more in Rubber4U – 15th April 2011 issue
Friday, April 1, 2011
Scheme for faster clearance
Exporters and importers may soon be allowed faster clearances for their goods, with the finance ministry planning to start a scheme that would simplify customs procedures and reduce intervention.
In December 2010, the government had released a draft paper on Authorised Economic Operator (AEO) for public comments. “We have received comments and will finalise the guidelines shortly. We have to decide the benefits in terms of faster clearance and less examination”, said a finance ministry official.
The finance ministry is planning to roll out the scheme in phases and may begin by taking up pilot projects with six exporters, having a sound track record, good accounting system, financially solvent and a secure company. Initially, it will be voluntary since the revenue department feels it would not be easy for every business to meet the stringent norms, which have high compliance costs. Once the Authorised Economic Operator (AEO) status is granted, businesses will have a recognised quality mark which will indicate their secure role in the international supply chain and that their customs procedures are efficient and compliant. This may particularly benefit small businesses that account for the majority of importers and exporters.
Read lot more in Rubber4U – 15th April 2011 issue
In December 2010, the government had released a draft paper on Authorised Economic Operator (AEO) for public comments. “We have received comments and will finalise the guidelines shortly. We have to decide the benefits in terms of faster clearance and less examination”, said a finance ministry official.
The finance ministry is planning to roll out the scheme in phases and may begin by taking up pilot projects with six exporters, having a sound track record, good accounting system, financially solvent and a secure company. Initially, it will be voluntary since the revenue department feels it would not be easy for every business to meet the stringent norms, which have high compliance costs. Once the Authorised Economic Operator (AEO) status is granted, businesses will have a recognised quality mark which will indicate their secure role in the international supply chain and that their customs procedures are efficient and compliant. This may particularly benefit small businesses that account for the majority of importers and exporters.
Read lot more in Rubber4U – 15th April 2011 issue
Cheque clearing becomes costlier
High value and outstation Cheque payment become costlier from 1st April 2011 onwards, as Reserve Bank of India (RBI) has allowed banks to levy higher service charges for their clearing. Previously, RBI did not allow banks to charge more than Rs. 150 per cheque for speed clearing of cheques worth over Rs. 1 lakh and there was no charges for value up to Rs. 1 lakh.
RBI has decided to lower the service charge for outstation cheques up to Rs. 5,000, by allowing a levy of Rs. 25, as against Rs. 50. The outstation cheques between Rs. 5,000 and Rs. 10,000 would continue to attract a fee of Rs. 50, while cheques between Rs. 10,000 and Rs. 1 lakh would also continue to be levied a charge of Rs. 100.
For normal local clearing drawee bank can charge up to Rs. 1.50 per cheque from 1st April, as against Rs. 1 previously.
Read lot more in Rubber4U – 15th April 2011 issue
RBI has decided to lower the service charge for outstation cheques up to Rs. 5,000, by allowing a levy of Rs. 25, as against Rs. 50. The outstation cheques between Rs. 5,000 and Rs. 10,000 would continue to attract a fee of Rs. 50, while cheques between Rs. 10,000 and Rs. 1 lakh would also continue to be levied a charge of Rs. 100.
For normal local clearing drawee bank can charge up to Rs. 1.50 per cheque from 1st April, as against Rs. 1 previously.
Read lot more in Rubber4U – 15th April 2011 issue
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