Natural rubber prices re-test December low levels, along with the expected benefit from fall in crude derivatives is positive for tyre companies
Natural Rubber prices are currently trading at Rs113/kg, a level last seen in December 2014. Domestic rubber prices had firmed up to Rs130/kg on back of the steps taken by the state government, increase in customs of imported natural rubber and fall in domestic production.
However, tracking the weakness in global rubber prices and the continued weakness in China, rubber prices have once again slid to the lows.
The fall in rubber prices and the recent slide in crude (expected to reflect in prices of crude derivatives) will benefit domestic tyre manufacturers such as Apollo Tyres, JK Tyre, Ceat and MRF.
