India, the world’s second-biggest rubber consumer, is likely to import a record 200,000 tonnes of natural rubber in the year ending March 31, 2012 as tyre makers cash in on lower customs duties, the head of a trade body said on Tuesday. “Considering the lower imports duty and price parity, I think imports of at least 200,000 tonnes would be there,” George Valy, president of the Indian Rubber Dealers’ Federation, said in an interview.The country had already imported a record 177,637 tonnes of natural rubber in the financial year which ended in March 2011. Valy said in 2011/12 consumption is likely to rise by 5.4 per cent to one million tonnes and production would be 900,000 tonnes, up 4.4 per cent on the year.The federal government has allowed imports with a duty of 20 per cent or 20 rupees a kilogram (kg), whichever is lower, for the current financial year, effectively cutting the import duty. Tyre makers this year were importing rubber and paying duty of 20 rupees per kg. They would have been paying duty of over 43 rupees per kg at current prices had the duty been 20 per cent. The country, the world’s fourth-biggest producer, will need more imports than the implied shortfall of 100,000 tonnes for 2011/12 as farmers are not selling all their production.They are holding some stocks in the hope of higher prices in future, Valy said, after prices more than doubled in the last two years.“Farmers are holding a huge amount of stocks. This has never happened before. The holding tendency is unlikely to allow domestic prices to correct sharply. As soon as prices go down, farmers cut supplies,” he said. The south Asian country’s imports in the first quarter of the current financial year rose 9.7 per cent on a year ago to 41,929 tonnes. India imports natural rubber from Thailand - the world’s biggest producer - Indonesia, Malaysia and Vietnam. The world’s largest importer is China, which is also the top consumer with an intake of 3.5 million tonnes.There were concerns that India’s natural rubber consumption growth could slow in 2011/12 as auto sales are falling, hitting tyre demand from original equipment manufacturers (OEMs).
From / Gulf today