Rubber shortage triggering costlier tires?
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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