• Sep 22, 2010
According to the man who runs the world's largest producer of natural rubber, demand for the gummy stuff will exceed supply for "at least another two years." The drop in production is said to be due to both droughts and heavy rains, but the result for you is an increase in the price of tires: both Bridgestone and Goodyear have raised their prices already.
According to Bloomberg, there was a rubber surplus of 237,000 tons last year, whereas this year there is expected to be a shortage of 60,000 tons. The drop in supplies and inventory has raised the price of rubber, and as investors move to take advantage of the rise in the commodity price, rubber is being pushed to a near-record $4 per kilogram. Climate-hampered tapping seasons in places like Thailand, Indonesia and Russia mean that actual harvests haven't met predictions.

Bridgestone, Goodyear and Cooper Tire raised their prices once this year and have just announced they'll do it again in October. The uncertainty of the economic recovery over the next two quarters could keep more increases from coming soon after, but according to insiders and observers, there will be price pressures on rubber-based goods for some time.

[Source: Bloomberg | Image: Getty]



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  • 14 Comments
      • 4 Years Ago
      Will we see a corresponding increase in the birth rate ?
      • 4 Years Ago
      can the start manufacturing the twheel anytime soon?
      • 4 Years Ago
      The sky is falling! we're headed for peak rubber! ;)
        • 4 Years Ago
        Dan? Is that you? Did you hijack Middle Way's account?
      • 4 Years Ago
      Great to know that the drop in tire prices that occured last year where the result of a surplus of rubber. Heavy sarcasm........
      • 4 Years Ago
      How much natural latex do they still use in tires? I mean, synthetic rubber was developed over 70 years ago, in response to the Japanese military's capture of Asian latex-producing countries. I thought that most of the rubber used in tires was synthetic, petroleum-based stuff.
        • 4 Years Ago
        Good question. I also though that we would recycle a lot of the material.

        Secondly, the price increases are most likely based on just raw material that has yet to hit the production floor. Therefore, your buying tires with material that was priced lower, thus higher margins for Goodyear and Bridgestone.
      mag3865
      • 4 Years Ago
      Has she lost her wheel lock key?
      • 4 Years Ago
      This should be interesting for the drifting scene...
      • 4 Years Ago
      Cost of a burn-out just went up! Take it easy on the go pedal boy! ;-)
      • 4 Years Ago
      I would be happy to help her out changing that tire. And anything else she might need done.
      • 4 Years Ago
      I have to wonder how many cars are needlessly equipped with V-rated tires that wear out in 20-25,000 miles, and how that's affected tire consumption in the US and the world over the last five years.
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