Natural rubber at record prices: what it means for tyre prices

Natural rubber is more expensive in India than it has ever been. On 24 October 2026 the Rubber Board quoted the benchmark RSS-4 grade at ₹29,250 per 100 kg in the Kottayam market, or ₹292.50 a kilo before 5% GST. Eleven days earlier, Onmanorama had reported a record of ₹284.50 a kilo in Kottayam and Kochi, beating the previous high of ₹284 set on 1 August, with domestic prices running above international rates on strong demand from tyre makers and tight supply. For anyone buying tyres, the question is how much of that reaches the shop. Tyre makers have already passed on around a tenth, and say more is needed.

Why rubber matters so much to tyre prices

Tyres are the main use of natural rubber in India. ATMA, the makers’ association, says the tyre industry consumes about 70% of the natural rubber used in the country, and that about 60% of the rubber Indian tyre makers use is natural, the reverse of the global pattern, where synthetic rubber dominates. Crisil Ratings estimates that natural rubber accounts for nearly half of the industry’s raw material costs.

India does not grow enough for its own needs. ATMA said in 2025 that nearly 40% of the industry’s natural rubber is imported, and it has complained that imports face a 25% customs duty, higher than in any other importing country.

Rubber is not the only cost rising. ATMA warned in a representation to the government that the West Asia conflict was pushing up crude-oil-linked materials such as synthetic rubber, carbon black, processing oils and tyre cord fabric, and disrupting shipping routes that the industry relies on for imports.

How far costs have risen

Crisil put natural rubber at about ₹275 a kilo in June 2026, against an average of about ₹220 in 2025-26, and described a 35 to 40% rise in key inputs. Prices have climbed further since. Crisil expects the operating margins of the six makers it tracks to fall to 11.5 to 12% in 2026-27, from about 14.2% the year before, calling it “a cost-pass-through lag rather than a structural profitability reset”.

The June quarter results showed the squeeze, according to Business Standard. JK Tyre’s operating margin fell to 6.8% from 10.9% a year earlier, CEAT’s to 8.6%, and Apollo Tyres’ to 11.7% from 13.2%. The companies expected their raw material costs to rise another 8 to 10% in the September quarter as more expensive stock reached production.

What tyre makers have done about it

All three raised replacement tyre prices in stages. By the time of their June-quarter results calls:

• CEAT had raised replacement prices by about 11% cumulatively. “We have to take further price hikes,” managing director Arnab Banerjee told analysts.
• Apollo Tyres had raised prices by about 9% for truck and bus radials and 11% in other categories. Its chief financial officer, Gaurav Kumar, said it needed an increase of about 15 to 16% overall, and that at least one or two more rises would be required.
• JK Tyre had raised replacement prices by about 11% cumulatively and expected price increases, cost cuts and more premium products to restore margins in the second half of the year.

What it means if you need tyres

Expect replacement tyre prices to keep edging up while rubber stays near these levels. That is not a reason to buy tyres you do not yet need: tyres age on the shelf as well as on the car, and a set bought early simply starts its clock sooner. Replace when the tread or the tyre’s age says so; our guides to tread depth and tyre age explain both. The price bands on our brand pages carry the date they were checked, so you can tell how current they are.