Courbevoie,France- Société Internationale de Plantations d’Hévéas (SIPH) has reported a 5.7-percent year-on-year increase in turnover from its rubber-related activities to €47.7 50 for the first quarter of the year.
The improvement was despite weakened NR pricing: the average price of rubber is 1.04 €/kg for Q1 of 2016, according to a company financial statement issued 15 May.
The average was below the equivalent price of 1.26 €/kg in the first quarter of 2015, and down by 5 percent compared to the fourth quarter of 2015 (1.09 €/kg).
The declines, said SIPH, were mainly the result of a lower price for rubber expressed in dollars, whereas the Euro has practically not varied at all facing the dollar since last year.
Indeed, the company noted a sharp pick-up in rubber prices during the second quarter, with an average figure of 1.31 €/kg during April.
During the first three months of 2016, tonnages sold were up 22.3 percent compared to the prior-year first quarter, to 48.1 thousand tonnes.
SIPH linked the gains to a significant growth in production with larger amounts of rubber being bought from rubber growers. This source accounted for 67 percent of total production, up from 64 percent year ago.
"This sharp rise in sales to a large extent countered the fall in selling prices expressed in Euros (which were down 13.6 percent as compared)," SIPH reported.
Reviewing the market, SIPH said global supply & demand was "close to balancing" in 2015, and forecast demand to continue improving.
The trend, it forecast, "should enable stocks to reduce gradually. The increase in prices we have observed since March of 2016 clearly indicates that way."
SIPH went on to say that it would maintain its strategic investments as regards regular growth of plantation surfaces, and renewal and adaptation of industrial capacities.
"Investments will amount to something like €19 million in 2016, while maintaining some flexibility according to trends in prices," the company concluded.
SIPH produces and processes NR for industrial use, managing over 40,000 hectares of mature rubber trees. Its current production capacity is 250 kilotonnes spread over Côte d’Ivoire, Ghana, Nigeria and Liberia.
Treated latex comes both from SIPH’s own rubber plantations and from purchases made from independent growers, with end materials supplied mainly to the global tire industry.