ERJ staff report (BC)
Singapore – Inventory of imported rubber in China's bonded warehouses in Qingdao fell by 3.4 percent over a two-week period as tire makers shifted to cheaper local stocks on worries about the economy, Lewa Pardomuan of Reuters reports trade sources as having said.
This could signal more pressure for global rubber prices as tire makers – the biggest importers of rubber – check their overseas purchases.
Tire-grade rubber prices are reported as sinking to multi-year lows on worries about global economic growth and weakening demand from top rubber user China, which accounts for 35 percent of global consumption.
Rubber stocks at Qingdao, which make up the bulk of China's inventories, currently stand at 330 300 tonnes, down from 341 900 tonnes in early July but still above the usual level of 250 000 tonnes, sources are reported as saying.
"The Chinese don't import rubber as much as they did last year. We can also see tire makers are stepping up the pace in using the stocks in China," Gu Jiong, an analyst at Yutaka Shoji Co in Tokyo is quoted as commenting.
"I think the inventory can continue to drop, maybe to 230 000 tonnes."
Preliminary June customs data showed China's natural rubber imports fell to 130 000 tonnes from 180 000 tonnes in May. Synthetic rubber imports slipped 18 percent.
Inventory in Qingdao consists of natural, synthetic and compound rubber.
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Full story from Reuters
