Rubber plantation woes to spark hike in tyre prices
Rubber prices have continued to rise so strongly that it is even a factor in imminent price increases for farm machinery such as Massey Ferguson tractors and slurry tankers.
Tyre suppliers report that they have been notified by tyre manufacturing companies of another 10pc price rise from the beginning of next month.
This comes despite reports from Deutsche Bank Equity Research that the cost of "certain key raw materials" used by tyre manufacturers had begun to decline in the early part of this month.
This price rise follows a 9pc increase in February and a 4pc rise in November, according to tyre wholesalers. As a result, tyre prices from this week will be at least 20pc up on this time last year. Some dealers estimate that their prices have increased by as much as 30pc in the past 12 months. Part of the reason for the spike in rubber prices is linked to ongoing disease problems in key rubber-plantation production regions.
"Prices from the manufacturers had been increasing once or twice a year in the past," said Galway-based Kevin Burke. "But now we're seeing price increases coming at us every one or two months."
He said that Michelin tyres will have increased in price by 30pc by the end of this year. Pat Whelan, of Cork-based Rathcormac Tyres, said that his prices had increased by up to 15pc over the past few months.
"It's getting harder and harder to pass it back to the customer," he said.
A southeast-based supplier said that the price of his BKT 580/70R38 tyres had gone from €750 plus VAT in 2009 to €820 last year and €920 plus VAT this year. That equates to a 23pc rise over the past two years.