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The increase in the crude oil price has hit the rubber industry leading to the rise in the synthetic rubber prices. The industry has already been facing severe shortage of carbon black and other raw materials essential for making rubber. As per the President of All India Rubber Industries Association, Kamal Chaudhary, the country is facing about 50% deficit of carbon black at the moment.
India imports over 50% of its synthetic rubber, a derivative of crude oil. With the increase in the synthetic rubber varieties by 20-25%, the local manufacturers are looking to raise prices.
According to the Director of Bombay Chemical and Rubber Products, Vishal Jhunjhunwala, with the prices of imported styrene butadiene gone up to $2,000 per tonne, from $1,600 to 1,700 per tonne in just a week’s duration, the domestic manufacturers will also follow the suit in coming weeks. Styrene butadiene and poly butadiene are the major chemicals used in the making of synthetic rubber. Also, with the growing sales of passenger cars, the synthetic rubber’s use has gone up of late in the country.
However, with the domestic production of synthetic rubber being dominated majorly by Reliance Industries and Indian Synthetic Rubber, the countries dependence on imports has reduced to some extent.
A higher percentage of synthetic rubber is used in passenger car radials compared to bus and truck radials. The reason is that it gives better speed and performance.
