Indian rubber demand rising on growing auto sector

India's rubber consumption is expected to continue growing in the next few year, driven by the auto sector, industry officials said on Friday. Y.S. Lathia, head of the All India Rubber Industries Association, told Reuters on the sidelines of a rubber conference he expected Indian rubber consumption to grow at a rate of at least 10 to 12 percent per year.
"We expect it to continue growing because the automobile industry is growing at 10 to 15 percent a year," Lathia said. India was the world's fourth-largest consumer of rubber in 2005, using 1 million tonnes of it, or about five percent of the world consumption, according to London-based International Rubber Study Group (IRSG).
India consumed only 700,000 tonnes of rubber in 1996. India has limitations in terms of land suitable to grow rubber, which means it needs to import more from other countries, industry officials at the conference said.
"India does not produce enough rubber for both natural and synthetic rubber. They have to import, especially synthetic rubber," said Prachaya Jumpasut of the IRSG. "There are very few areas where natural rubber can be grown in India, so we expect India will import more in the future," Lathia said.
India produces around 800,000 tonnes of natural rubber a year, most of it is consumed in the country. Trade officials said Indian demand could be second only to China. "Demand for rubber from India will continue to increase quite rapidly, probably next to China in terms of the rate of growth," the IRSG's Prachaya said.
"This is due to its growing auto sector. The population is becoming more urbanised, which will increase demand for cars." China is expected to consume 33 percent of global rubber output by 2020, up from 21 percent last year, according to IRSG. China buys rubber from Thailand, Malaysia and Indonesia, the key producing countries accounting for some 60 percent of world output.
In 2005, China consumed 4.4 million tonnes of rubber, both natural and synthetic, followed by the United States at 3.1 million tonnes and Japan with 2 million tonnes, according to data from IRSG. No data for rubber consumption in 2006 is available yet.