The Automotive Tyre Manufacturers’ Association (ATMA) of India has once again called on the government to exempt import duties on natural rubber (NR), citing severe domestic shortages that have disrupted the country’s rubber supply chain.
According to ATMA, India produced only 30,000 tons of natural rubber in June, far below the projected output of 60,000 tons. This shortage has left tyre and rubber product manufacturers struggling to maintain operations.
Severe Supply Constraints Threaten Production
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In a notice sent to the Rubber Board of India, ATMA stated that virtually no NR trading activity took place in July, seriously affecting businesses across the rubber value chain—from small and medium-sized enterprises (SMEs) to large tyre manufacturers.
Rajiv Budhraja, Director General of ATMA, warned that domestic supply deficits could threaten factory-level production. Several tyre factories among ATMA members reported a drop of over 10% in output during July due to the ongoing NR crisis.
“Production schedules are in chaos,” Budhraja said. “Imported natural rubber can only enter through two designated ports, forcing manufacturers to shift limited stocks from one factory to another just to keep operations running.”
SMEs Face Mounting Pressure
Shashi Kumar Singh, President of the All India Rubber Industries Association (AIRIA), noted that uncertainty in domestic NR and latex supply is causing widespread anxiety among SMEs, which lack the financial strength to hold large inventories.
Industry representatives have also challenged official inventory data, urging an independent audit to assess the real stock situation.
Record-High Prices and Policy Calls
Currently, domestic NR prices in India have reached a 13-year high, fueling speculative trading and creating further market volatility. The sector has requested the Rubber Board to reassess its stock position and provide relief for small manufacturers struggling under high import duties and domestic raw-material shortages.
SMEs have appealed for urgent government intervention to ensure stable and sufficient access to key raw materials like natural rubber. Rising local prices—well above global trends—could cripple smaller manufacturers, they warned.
Industry Investment at Risk
India’s tyre manufacturers have invested heavily to meet growing demand for original equipment (OE) and replacement tyres, but the ongoing raw-material crisis now threatens production momentum.
To avert further disruptions, the industry has reiterated its proposal for duty-free imports of natural rubber within the scope of domestic shortfall, and called for the removal of port restrictions that currently limit imports to just two entry points.