Kuala Lumpur – Natural rubber prices rose an average of 10% across key markets in January, according to the Association of Natural Rubber Producing Countries.
Also, despite soft results in 2016, the ANRPC expects NR production to rise more than 4% in 2017, according to the January 2017 issue of Natural Rubber Trends and Statistics, the association's monthly statistical report.
NR prices declined to about $1/kg in early 2016 and remained depressed for much of that year, according to ANRPC Secretary General Nguyen Ngoc Bich.
A favourable supply-demand situation and other market fundamentals improved the outlook for NR in January, Nguyen wrote in his preface to the January issue.
NR supplies have fallen 8.4% in ANRPC member countries, largely because of severe flooding in southern Thailand and early wintering in other countries, according to Nguyen.
Devaluation of the Japanese yen against the US dollar also helped NR prices to rise, he said.
NR production in the nine ANRPC member countries fell 2.7% in 2016, to 10.74 million tonnes from 11.04 million tonnes in 2015, the ANRPC said.
However, the ANRPC expects production to grow 4.4% to 11.22 million tonnes in 2017. Every member country except Indonesia is projecting a production increase, with Cambodia predicting a 37.2% rise to 204,000 tons from 149,000, it said.
Indonesia projects a 0.2% production decline in 2017, to 3.15 million tonnes from 3.158 million, the ANRPC said.
Meanwhile, member countries will increase their NR consumption by 1.8% in 2017, to 8.19 million tons from 2016's 8.04 million, the ANRPC said. Only Malaysia projected a decrease in consumption, to 490,000 tonnes from 498,000, a 1% decrease.
Although NR exports declined 3% in 2016, to 8.76 million tonnes from 2015's 9.03 million, the ANRPC projects 2.6% export growth in 2017, to 8.99 million tonnes.
NR imports will grow 1.8% in 2017, to 8.19 million tonnes from 8.04 million, the ANRPC said. Every member country except China predicts a decrease in imports, but China – which anticipates imports of 4.3 million tonnes in 2017 – is by far the largest importer among ANRPC nations, the association said.