* Imports to fall on weak demand, higher duty
* Tyre cos cut purchases due to slowdown in auto industry
* Rubber output seen rising 2 percent on new plantation
By Rajendra Jadhav
MUMBAI, April 17 India's natural rubber imports
in 2013/14 are likely to fall by a quarter, the first drop in
five years, as demand stagnates due to a slowdown in the auto
industry and a possible hike in import duties, a senior industry
A reduction in imports by India, the world's fourth-biggest
natural rubber producer, would put further pressure on Tokyo
rubber futures <0#2JRU:>, which already hit a five-month
low earlier this week.
India's imports are likely to fall by 25 percent in the
period April 2013 to March 2014 from 216,642 tonnes in the
previous year, George Valy, president of the Indian Rubber
Dealers' Federation, said in an interview.
"The gap between rubber demand and supplies is coming down.
Supplies are rising due to the new plantation in north-eastern
states, but consumption is stagnant. The slowdown in the auto
industry is cutting rubber demand from the tyre industry," he
Tyre makers are the main importers of natural rubber and the
biggest buyers of domestic supplies in India. Other users
include manufacturers of gloves, tubes, balloons and toys.
India's annual car sales fell for the first time in a decade
in the 12 months to March 31 and are expected to post subdued
growth this year due to high interest rates and fuel prices.
India started the new year with stocks of 266,000 tonnes,
nearly 13 percent more than the previous year, data with the
state-run Rubber Board showed.
In addition, India has been considering raising import
duties on natural rubber, and the official order to implement
the increase will be issued soon, Trade Minister Anand Sharma
said last month.
"The government's plan to increase import duty would also
deter importers," Valy said.
The south Asian country could increase import duties on
natural rubber by as much as 70 percent to support falling local
prices, two industry sources and one government official said in
Spot rubber prices in India have fallen 18 percent in a year
to 16,100 rupees ($300) per 100 kg, but they are still higher
than prices in exporters Malaysia and Thailand.
India's production of natural rubber is likely to rise by
more than 2 percent to 932,000 tonnes in 2013/14 as newly
planted trees in the north-eastern states are becoming mature
enough to tap, Valy said.
Farmers in India usually start tapping rubber when the
plants are seven years old and continue until they are 30.
Natural rubber consumption in the year is likely to remain
steady around last year's level of 971,980 tonnes, Valy said.
"On the consumption front, things are worrisome. The
slowdown in the auto industry has been trimming tyre companies'
sales to OEMs (original equipment manufacturers or automakers).
They are cutting rubber purchases. Demand will remain weak at
least in next few months."
($1 = 54.2250 Indian rupees)
(Reporting by Rajendra Jadhav; Editing by Jo Winterbottom and