ANRPC projects tight NR supply

ERJ staff report (DS)

Kuala Lumpur - The ANRPC (Association of Natural Rubber Producing Countries) in its latest Natural

Rubber Trends & Statistics bulletin said the current supply/demand situation may be unparalleled in history.

Although demand has slowed progressively through the year - despite increases in truck tyre sales - the exchange rates of the Thai, Malaysian and Indonesian currencies are having an increasingly important impact on global natural rubber (NR) markets.

ANRPC said China, India and Malaysia consumed 47 percent of world's NR in 2009. This was inflated by the relatively low production of truck tyres in the developed world.

ANRPC said, “In China, the growth in consumption of NR (including NR rich

grades of compound rubber) sharply slowed

down from 28.2 percent to 4.4 percent over Q1 to Q3 on

annualised basis. The country has scaled down

its consumption anticipated for the current year

by 50,000 tonnes to 3.30 million tonnes.”

it continued, “Given China's large market size of NR, even a

small change in the growth rate is crucial to the

global demand for the commodity. The country,

which has replaced Japan this year to become the

world's second largest economy, accounted for

32 percent of the global demand for NR during 2009.”

ANRPC said the demand pattern in India has been similar to

that in China. Growth slowed from 12.2 percent at the start of the year to 1.0 percent in the third quarter

In terms of supply, the ANRPC said, “Global production of natural rubber may grow

up to 6.3 percent in 2010 as per data and estimates

reported in mid-September by ANRPC's

members.” However, the organisatino warned that this may be revised downward, as Indonesia's full-year projections have not taken into account a 10.4 percent decline in output in the year to June. A similar situation exists in Thailand.

ANRPC said, “The output in Indonesia slowed down from

17.0 percent annualised rate in Q1 to 2.5 percent rate in Q2

in spite of the tappable area expanded by

64,000 ha during the year. Although the

government has not scaled down the output

anticipated output for the year, there have been

reports that production badly affected in June

and July due to unusual rains. The production

officially reported for June has already shown

10.4 percent fall on year.

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