Rubber Industry May Suffer Soon
Saturday, April 25th, 2009The falling trend in the car industry continues and to sustain their business, expect some tire manufacturers to lower their prices to stay afloat as well. It is practically a chain reaction. With most car companies suffering from low car sales, the demand for rubber tires is likewise expected to encounter rough sailing.
Tire makers, the biggest consumers of rubber, could report a 6.8 percent sales slump in 2009 as the global recession cuts auto demand, according to the government-funded International Rubber Study Group in Singapore. Supplies from Thailand, the top exporter, will increase after a seasonal drop, producers say. Prices of $1,530 a ton are 18 percent higher than alternatives made from oil, data compiled by Bloomberg News shows.
Demand will drop because people are buying fewer cars and delaying the purchase of replacement tires. U.S. auto sales plunged 37 percent in March, and the annual rate fell to the lowest in more than 25 years in February, according to Autodata Corp. Japan’s sales tumbled 32 percent in March to a level not seen in more than three decades. U.S. vehicle miles traveled fell by 7 billion, or 3.1 percent, in January from a year ago, the Federal Highway Administration said.
(Source) Ohio
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