Rubber Climbs to 30-Year High in Tokyo, Record in Shanghai, on Thai Supply

Rubber Climbs to 30-Year High in Tokyo, Record in Shanghai, on Thai Supply
Posted: 09 Nov 2010 05:48 AM PST
Rubber in Tokyo surged to 30-year high, while futures in Shanghai advanced to a record, on concern that rain will likely lower the output of major growers and as commodities rallied.

April-delivery rubber on the Tokyo Commodity Exchange rose as much as 2.1 percent to 366.8 yen a kilogram ($4,536 a metric ton), the highest level since February 1980. The contract settled at 365.2 yen and has rallied 32 percent this year. May- delivery rubber on the Shanghai Futures Exchange gained for a seventh day, surging by the daily limit to a record 37,735 yuan ($5,660) a ton before closing at 37,370 yuan.

Heavy rain in Southeast Asia and India damaged rubber plantations amid strong demand, according to the Rubber Research Institute of Thailand. About 1.9 million acres of farm land, or 4.8 percent of total arable land, was damaged by floods that spread across 51 provinces in Thailand, according to the Department of Disaster Prevention and Mitigation.

“Persistent, heavy rainfall across the top three producers - Thailand, Indonesia and Malaysia - has raised concerns that tightening supplies will worsen,” Chaiwat Muenmee, analyst at DS Futures Co., said by phone from Bangkok.

The cash price in Thailand, the largest producer, gained 2.4 percent to 128 baht ($4.33) per kilogram today because rain in the south has cut supply, the Rubber Research Institute of Thailand said. The price touched a record 130.55 baht on April 27. The rubber-trading center in Songkhla province was closed for three days from Nov. 2 because of floods.

Commodities Demand

“Rubber advanced as a record-breaking rally in gold raised speculation that investor demand for commodities is rising,” said Shuji Sugata, research manager at Mitsubishi Corp. Futures Ltd. in Tokyo.

Gold for immediate delivery climbed to a record, rising as much as 0.4 percent to $1,414.85 an ounce on concern that some European governments may struggle to raise funds, boosting demand for high-yield assets. Portugal prepared to sell as much as 1.25 billion euros ($1.74 billion) of debt tomorrow.

“Given tight fundamentals, rubber futures in Tokyo are expected to test the record high of 388.9 yen” reached on Feb. 13, 1980, said Masayo Kondo, the president of Commodity Intelligence Ltd., a Tokyo-based research company.

Crude rubber stockpiles held at Japanese warehouses rose 3.6 percent to 7,771 tons on Oct. 31, according to data today from the Rubber Trade Association of Japan.

(bloomberg.com)





Tokyo rubber near 30-year high
Posted: 09 Nov 2010 05:46 AM PST
TOKYO (November 09, 2010) : Key Tokyo rubber futures erased earlier gains on profit taking but hovered near a 30-year high on Monday, supported by strength in other commodity markets and tight supply. The key Tokyo Commodity Exchange rubber contract for April delivery settled at 359.2 yen per kg, down 2.5 yen or 0.7 percent from Friday, after rising as high as 364.2 yen earlier.

The benchmark contract on Friday jumped nearly 5 percent to a peak of 364.8 yen, the highest since March 1980, on heavy speculative buying following the Federal Reserve's latest move to boost the US economy. The most active Shanghai rubber futures contract for May delivery also hit a record high of 37,070 yuan per tonne on Monday before retreating to end at 35,865. Volume was heavy at about 1.28 million lots.

On Friday, the contract settled at its daily limit-high of 35,025 yuan per tonne. Traders have said that while supply concerns in producing countries, hit by heavy flooding, underpinned demand, investors were wary of the recent rapid pace of gains and took profits when the dollar strengthened.

(brecorder.com)





Rubber prices cross all-time high
Posted: 09 Nov 2010 05:42 AM PST
Kottayam:

The price of natural rubber has crossed the double century mark for the first time and reached an all-time high of Rs. 202 per kg in the domestic market here on Monday.

The price of Ribbed Smoked Sheet (RSS) four grade touched the Rs.200 level on Friday owing to fall in production which again led to decline in supply in the national and international markets.

Business was less in the last week following Deepavali holidays and the production has been hit by rains in many rubber growing areas, traders said.

Natural rubber prices were on a gaining spree for the past few days due to continuous rains in central Kerala and in Malabar region which adversely affected tapping, according to Rubber Dealers Federation president George Vally.

Taking into account the spiraling price trend possibility to hoard the commodity cannot be ruled out by a section of the growers on the assumption that the price will rise further, he said.
Vally appealed the growers to release the commodity in the market and help to stem the price level "unseasonable rains continuing wherever rubber grows including Thailand and Malaysia", he said. On Saturday the price has crossed Rs.200 level and reached to Rs. 203 and closed at Rs. 202 on Monday which was Rs. 16.50 higher than the international price. The present trend in price level will decrease only after a change in climate and arrival of the commodity into the market.

The situation remain the same in other rubber producing countries.

The price which had breached Rs. 180 per kg in July 2010 declined to Rs. 160 by august following the declaration of new import duty regime. The price was stabilized around the same level in September. On October 30 the price has reached Rs. 190 a kg and on Wednesday last it was traded at Rs. 195.

On Thursday the price moved up to Rs. 198.

In the global rubber production during the current year upto June 2010 the output rose to 4439 million tonnes from 4192 MT in the same period of the previous year, registering an increase of 5.96 per cent, Rubber Board sources said.

The consumption on the other hand jumped up by 17.8 per cent, from 4259 MT to 5016 MT, the sources said.

(indianexpress.com)





Tyre grade rubber at record highs in Southeast Asia
Posted: 09 Nov 2010 05:40 AM PST
Nov 9 (Reuters) - Tyre grade rubber changed hands at an all-time high above $4 a kg in Southeast Asia as consumers scrambled for stocks after heavy rains curbed supply in main producing countries, dealers said on Tuesday.
Indonesia's SIR20 was sold to Singapore dealers at as high as 194 cents a pound ($4.28 a kg) for nearby shipment on Tuesday. Malaysia's SMR20 was traded at $4.30 a kg late on Monday, while Thai RSS3 was sold to a Japanese trading house at $4.30 late last week.

(reuters.com)





Sungai Buloh Land Redevelopment To Further Boost Rubber Industry
Posted: 09 Nov 2010 05:38 AM PST
KUALA LUMPUR, Nov 9 (Bernama) -- The Malaysian Rubber Board (MRB) will use proceeds from the redevelopment of prime land at its Sungai Buloh research facility to further uplift the local rubber industry and enhance its image.

Its director-general Datuk Dr Salmiah Ahmad said that monetisation of the 1,320 hectares (3,300 acres) of land belonging to the then Rubber Research Institute of Malaysia (RRIM) would enable MRB to modernise many of its facilities, including laboratories needed for advanced research and development (R&D).

MRB came into being in 1998 after the merger of RRIM, Malaysian Rubber Research and Development Board and Malaysian Rubber Exchange and Licensing Board.

Under the revamp, MRB will be allocated 243 hectares (600 acres) for R&D activities with the rest of the area to be redeveloped as part of the Greater Kuala Lumpur Strategic Development Project initiative under the 10th Malaysia Plan.

Of the present total land area, rubber plantations take up about 939 hectares (2,320 acres) while the remaining area houses nurseries, experimental laboratories, midstream and downstream pilot plant factories and housing for employees, two schools, a mosque, a Hindu temple, heritage buildings and recreational facilities.

"We must move with the times, we need new equipment and laboratories to conduct further research and help the industry to grow further," Dr Salmiah in an interview with Bernama.

On concerns that that the storehouse of 85 years of invaluable research on natural rubber may be lost if the Sungai Buloh land were to be redeveloped, she said not all of the property would undergo a revamp.

This is because some tracts of land planted with trees that date back to many decades, including two research expeditions to Brazil in 1981 and 1991 funded by the International Rubber Research Development Board, will be left untouched but converted into a living rubber museum.

(It was also partly for the same reason that the then Subang International Airport was not allowed to be extended into Sungai Buloh in view of the storehouse of rubber research, hence giving birth to the Kuala Lumpur International Airport in Sepang).

Dr Salmiah said from the germ plasms (hereditary material of germ cells) collected from the two expeditions to Brazil, MRB had been able to come up with high-yielding clones from its own research.

"They are very valuable and we have to keep them really within our control," she said, adding that the priceless trees and research could be considered as national treasures or "khazanah negara" as they were the key to the future of Malaysia's rubber industry.

As such, she added, the living rubber museum would enable the trees to be left intact for further research to be carried out.

To safeguard the research undertaken at Sungai Buloh, Dr Salmiah said MRB had also transferred its present R&D activities to four other rubber research stations in Kota Tinggi (Johor), Bukit Kuantan (Pahang), Sungai Sari (Kedah) and Similajau (Sarawak).

Some of these stations were also testing clones derived from the germ plasms on a bigger scale than Sungai Buloh, she disclosed, adding that this meant that the legacy of the Sungai Buloh research would continue to live on at the other four stations.

On other plans for the Sungai Buloh land, Dr Salmiah said MRB had proposed to centralise all its operations, including its headquarters, now located at three different sites in the Klang Valley, at Sungai Buloh so that it would be more cost-effective besides having improved research-related and commercial facilities.

These include having a centre of excellence with better R&D facilities for better research and serving clients better and setting up a Royal Commodity College to produce trained workers for the rubber industry.

"Our (research) backlog is very high because we don't have enough capacity.

The redevelopment will change all that because we need to serve the industry better," she said.

In addition, MRB will also provide facilities for the establishment of business clusters in the area.

"When we come out with new technology we want the industry to have the feel of the technology first. They can come and set up their preliminary offices within these facilities and test out the technology," Dr Salmiah said.

"Once they are more comfortable, they can go out and set up their commercial plants," she said, adding that the business cluster facilities would also be useful for overseas rubber-based companies looking to set up shop in this region.

According to Dr Salmiah, the redevelopment of the Sungai Buloh land is a win-win solution for the government and MRB.

"Redevelopment means that the government will benefit from monetising its property while MRB, which has been depending on the government for funding, will get the necessary but increased funding for its expanded activities to further boost the local rubber industry," she said.

-- BERNAMA





350,000 Smallholders Stand To Gain From Record Rubber Prices
Posted: 09 Nov 2010 05:37 AM PST
KUALA LUMPUR, Nov 9 (Bernama) -- Some 350,000 smallholders stand to make big gains from record rubber prices, with the price of SMR20 reaching it highest ever yet on Monday.

Rural and Regional Development Minister Datuk Seri Mohd Shafie Apdal said at Monday's price of RM12.44 for a kilogramme of SMR20, the smallholders would be able to derive a gross income of RM4,000 a month.

"Looking at the trend of commodity prices the last several years, rubber prices have very been stable, This is a boon for smallholders," he told reporters after attending Risda's (Rubber Industry Smallholders Development Authority) Quality and Innovation Day here Tuesday.

In view of rubber showing good potential, he said Risda's rubber replanting scheme had been allocated RM217 million this year which would see replanting done in 131,528 hectares involving 52,000 smallholders.

He added that as of Sept 2010, 96,215 hectares or 73 per cent of the alienated acreage had been successfully replanted.

On plans to create Risda Holdings, Mohd Shafie said it was still at the ministry's stage and that once it took off, would be an apex company with paid up capital of RM50 million that would tasked with managing 10 agencies under it.

-- BERNAMA





Rubber Climbs to Records in Shanghai, Singapore as Demand Outstrips Supply
Posted: 08 Nov 2010 03:32 PM PST
Rubber in Shanghai, Singapore and Thailand climbed to records amid concern that rain and flooding may limit supply from major producers in Asia. Futures in Tokyo retreated from a 30-year high.

May-delivery rubber on the Shanghai Futures Exchange jumped as much as 5.8 percent to an all-time-high of 37,070 yuan ($5,558) a metric ton before closing at 35,865 yuan. December- delivery rubber on the Singapore Commodity Exchange advanced as much as 2.8 percent to $4.34 a kilogram.

“Increasing worries over damage to rubber production from floods and landslides in Thailand drove prices to new highs,” Varut Rungkhum, analyst at commodity broker Agro Wealth Ltd., said by phone from Bangkok.

June-delivery rubber on the Agricultural Futures Exchange of Thailand gained as much as 0.4 percent to 131.50 baht ($4.40) a kilogram, the highest level for the most-active contract since the bourse was established in 2004.

The cash price in Thailand added 0.2 percent to 125 baht per kilogram today, according to the Rubber Research Institute of Thailand. The rubber trading center in Songkhla was closed during Nov. 2-4 due to floods.

Exporters in Thailand, the largest producer, raised prices of so-called RSS-3 grade rubber to foreign buyers by 7 percent in the past week, according to Kazuhiko Saito, an analyst at Tokyo-based broker Fujitomi Co.

“Rubber continued a bull run because of concern about supplies,” Saito said by phone today. “News about a volcano eruption in Indonesia also raised speculation that supply from the country, already limited by rain, may tighten further.”

Thailand, Indonesia

Heavy rain in Thailand, Indonesia, Malaysia, Vietnam and India has damaged rubber plantations, causing a supply shortage amid strong demand and supporting prices, the Rubber Research Institute of Thailand said on its website today.

About 6.3 million rai (1.9 million acres) of agricultural land, or 4.8 percent of total arable land, was damaged from floods that spread across 51 provinces in Thailand, according to the Department of Disaster Prevention and Mitigation.

Mount Merapi in Indonesia, the second-largest rubber exporter, has been spewing ash for two weeks. About 280,000 people sought shelter at evacuation centers outside the 20- kilometer (12 mile) safety zone after the latest big eruption on Nov. 5, according to the National Disaster Management Agency.

The volcano may release ash for as long as two months, Subandriyo, an official at the Volcanology and Geology Disaster Mitigation Center, said Nov. 3.

April-delivery rubber on the Tokyo Commodity Exchange lost as much as 1.8 percent to 355.3 yen per kilogram ($4,372 a ton) before settling at 359.2 yen. It jumped as much as 5.7 percent to 364.8 yen on Nov. 5, the highest level for the most-active contract since February 1980.

Futures in Tokyo declined as the dollar advanced against the euro, raising speculation that a stronger U.S. currency may weaken investor demand for commodities as an alternative asset, Saito at Fujitomi said.

(bloomberg.com)





IRCo's WEEKLY MARKET SNAPSHOT: 1 - 5 November 2010
Posted: 08 Nov 2010 03:31 PM PST
IRCo's DCP breached 400 US cents/kg on Thursday while other physical rubber prices and rubber futures also settled above 400 US cents/kg as well on Thursday and Friday due mainly to tighter supplies caused by flash floods in natural rubber planting areas in southern Thailand and heavy rain in northern Malaysia during the week.


At the same time, the second quantitative easing (QE) by the U.S. Federal Reserve on Wednesday 3 November stroked global stock and commodity markets to rise on Thursday and Friday, especially crude oil futures, that spurred investors/speculators to scramble for long positions on rubber futures.


It is notable that Thai baht, Indonesian rupiah, and Malaysian ringgit strengthened consecutively against the U.S. dollar during the week on the back of more attractive returns on investments in the East than in the West. The second U.S. QE can keep the U.S. economy moving in the coming quarters, but it will be clueless for the global economic development like some countries have criticized.

(irco.biz)





Tocom Open to Merger as Japan Aims to Integrate Exchanges, President Says
Posted: 08 Nov 2010 03:28 PM PST
Tokyo Commodity Exchange Inc., Japan’s largest raw-material bourse, is open to merger talks with other exchanges as the government considers creating a one- stop exchange for financial products, its president said.

The exchange, known as Tocom, once the second-largest commodities bourse after the New York Mercantile Exchange, ranked 11th last year and was surpassed by China’s Shanghai and Dalian exchanges. The government has started discussions on whether to combine securities, currencies and commodities bourses by 2013 to boost trade and remain competitive, Tocom President Tadashi Ezaki said in an interview in Tokyo.

“We welcome the government’s move,” Ezaki said. “I think nobody will oppose the integration if we become confident through the discussion that it will contribute to revitalizing trade.”

The value of China’s stock market surged above Japan’s to become the second-biggest last month, behind the U.S. China now has a capitalization of about $3.96 trillion compared with Japan’s $3.65 trillion. Hong Kong surpassed Japan for the first time as Asia’s most-lucrative market for stock lenders, boosted by investor demand for Chinese securities in short sales.

Vice ministers for financial services, trade and agriculture created a team on Oct. 28 to work on exchange- integration details proposed by Prime Minister Naoto Kan’s cabinet. They plan to compile an interim report by the end of this year after conducting hearings from related parties.

The ministers will hold the team’s next meeting tomorrow, according to the Ministry of Economy, Trade and Industry.

‘No Other Options’

“As shrinking trade in commodities futures is undermining earnings of domestic exchanges, and as there are no signs of recovery in the near future, they may have no other options but to merge with larger financial bourses,” said Shuji Sugata, research manager at Mitsubishi Corp. Futures Ltd. in Tokyo.

The Financial Services Agency supervises securities and financial futures bourses including Tokyo Financial Exchange Inc. Tocom is under the control of the trade ministry, while agricultural futures are supervised by the farm ministry.

Consolidation of Japan’s commodity markets is progressing as the number of raw-material bourses has dropped to four from seven in 2005, when the government tightened regulations over sales of riskier financial assets to individuals, leading to a slump in futures trading by retail investors, Sugata said.

The number will decline further as the Central Japan Commodity Exchange, the nation’s third-largest commodities bourse, will cease operations by the end of January after handing over energy futures trade to Tocom.

Slumping Volumes

Tocom may agree with the Tokyo Grain Exchange to take over agricultural futures trading next year as the two exchanges plan to integrate their trading systems in January, Ezaki said. The grain exchange lost 712 million yen ($8.8 million) last fiscal year after booking its first loss in 29 years in the year ended March 31, 2009, because of slumping volumes.

Tocom trades gold, silver, platinum, palladium, rubber, gasoline, kerosene, gas oil and crude oil. The grain exchange trades products including corn, soybeans, coffee and raw sugar. The Kansai Commodities Exchange, another agricultural commodity bourse based in the western Japanese city of Osaka, represented 0.2 percent of total volumes of the four exchanges last year.

Tocom had a 1.1 billion-yen loss last fiscal year after becoming unprofitable in the year ended March 31, 2009, for the first time since it began operating in 1984. The exchange may post a loss again this fiscal year, Ezaki said on Nov. 4.

“We are very concerned about the future of the market” as the government will further tighten regulations over the industry next year, said Jitsuo Tatara, the chairman of Tokyo- based commodity broker Yutaka Shoji Co.

Trading volumes may shrink further as the government will ban sales by brokers to individuals who have no intention to invest in commodities futures, he added.

Volumes at Tocom slumped by 30 percent from a year earlier to 28.9 million contracts in 2009, the fifth year of decline in six. From the peak in 2003, volumes tumbled by 67 percent.

In the first nine months of the year, volumes amounted to 20.5 million contracts, down from 21 million in the same period last year. Overseas participants represented 13.6 percent of total turnover, according to the exchange.

(bloomberg.com)





Phatthalung rubber farms plead for aid
Posted: 08 Nov 2010 03:27 PM PST
PHATTHALUNG : Rubber growers whose plantations have been damaged by the recent tropical depression are calling for government financial help.

Phatthalung was affected badly by the tropical depression that struck southern Thailand early last week, triggering severe flooding, said Suchart Salem, chief of tambon Mae Kharee in Tamot district.

All of Phatthalung's 11 districts were declared disaster zones and vast areas of rubber plantations were destroyed. The damage was particularly heavy in Pak Phayun, Bang Kaew, Khao Chaison, Khuan Khanun, Pa Bon and Tamot districts, Mr Suchart said.

"At least 10,000 rai of rubber plantations here have been severely damaged, costing about 2 billion baht in losses," he said.

Based on the present price of rubber sheets, 100 baht a kilogramme, one rai of a rubber plantation could yield more than 200,000 baht a year, he said.

Before the disaster struck, some rubber farmers were earning between 5,000 and 6,000 baht a day, he said.

The actual losses could be far greater given the fact that a rubber tree can be harvested on average for between 35 and 40 years, Mr Suchart said.

There are about one million rubber tapping families in the country, most of whom are in the South, who would now be out of work, he said.

Songtham Chansap, director of the Phatthalung branch of the Office of the Rubber Replanting Aid Fund (ORRAF), said official figures were not yet available on how many rubber tappers were affected by the depressions.

The office is still completing its survey on the damage to rubber plantations, and farmers are encouraged to report their circumstances to the ORRAF offices in their districts.

The president of the Rubber Holder Cooperatives Federation of Thailand, Pherk Lertwangphong, said the government should consider urgent measures to help rubber farmers. Mr Pherk said the government could use the 15 billion to 20 billion baht it has collected per kilogramme of rubber sold this year to fund relief measures for affected growers.

(bangkokpost.com)





Manufacturer of rubber products to bring 75-80 jobs to region
Posted: 08 Nov 2010 03:26 PM PST
Scougal Rubber Corp. will bring 75 to 80 jobs to northern Nevada as it moves from Seattle to share manufacturing facilities with its sister company and to relocate near its largest West Coast market.

Scougal Rubber will split space with Dynamic Isolation Systems, which occupies half of a 100,000-square-foot manufacturing facility on Denmark Drive in the Tahoe Reno Industrial Center. Scougal makes rubber and steel-reinforced bearing pads that set under steel girders during bridge construction, while DIS manufactures the large rubber pads used for seismic construction and retrofitting of buildings and bridges.

Growth also is propelling Scougal’s move from the Pacific Northwest, says Scougal President Matt Bowman.

“With the need to replace our country’s crumbling infrastructure of roads and bridges we have seen an uptick in our business volume,” he says. “There is lot of upgrading of the existing inventory of bridges.”

Scougal’s rubber pads allow a bridge’s steel girders to move laterally as the steel’s temperature varies with hot and cold weather. The rubber pads are constructed from layers of thin steel and rubber built up and bonded with heat. The pads are about the size of a few cases of beer, Bowman says, while Dynamic Isolation System makes rubber pads about the size of a small coffee table.

Scougal employs nearly 100 at its Seattle manufacturing plant, but only 15 to 20 workers are expected to relocate to northern Nevada. Scougal expects to hire production workers in the Reno-Sparks area using Nevada JobConnect, as well as Craigslist and Monster. The company expects to begin production in northern Nevada on Jan. 1 and be fully operational by the middle of the first quarter of 2011.

‘It will take us several months to get to that level, but it is a three-shift, five-day operation,” Bowman says.

The company will maintain a small footprint in the Seattle area, but its long-term plan is to transfer much of its manufacturing capacity to Tahoe Reno Industrial Center. Bowman says Scougal will share some business synergies with Dynamic Isolation Systems and also be much better positioned to serve California, its primary West Coast market.

“We are excited about being co-located next to (DIS), and the business environment in northern Nevada is every attractive,” Bowman says.

The move requires transfer of about a dozen pieces of heavy equipment, which will be refurbished as they are established at TRIC. Scougal also is investing in new rubber processing machinery, equipment to paint bearings, and a new boiler because its presses operate with steam.

Bowman says the main challenge is to keep up manufacturing levels during the transition, because many machines will be out of production during the move.

“We are real excited about the move — we are fortunate to be in a market that is growing, and the move to a new facility hopefully positions us for new growth. It’s good for the company, good for employees, and good for the customers that supply us.”

Scougal must use steel from a domestic foundry for federally funded bridge projects, and it imports rubber from Asia and synthetic rubber from U.S. suppliers Asia, and Germany.

Scougal qualified for business tax and sales tax abatements and training grants from the Nevada Commission on Economic Development. The company is expected to generate an economic impact of nearly $200 million over a 10-year period.

(nnbw.com)





Sungai Buloh Land Redevelopment To Further Boost Rubber Industry
Posted: 08 Nov 2010 03:25 PM PST
KUALA LUMPUR, Nov 9 (Bernama) -- The Malaysian Rubber Board (MRB) will use proceeds from the redevelopment of prime land at its Sungai Buloh research facility to further uplift the local rubber industry and enhance its image.

Its director-general Datuk Dr Salmiah Ahmad said that monetisation of the 1,320 hectares (3,300 acres) of land belonging to the then Rubber Research Institute of Malaysia (RRIM) would enable MRB to modernise many of its facilities, including laboratories needed for advanced research and development (R&D).

MRB came into being in 1998 after the merger of RRIM, Malaysian Rubber Research and Development Board and Malaysian Rubber Exchange and Licensing Board.

Under the revamp, MRB will be allocated 243 hectares (600 acres) for R&D activities with the rest of the area to be redeveloped as part of the Greater Kuala Lumpur Strategic Development Project initiative under the 10th Malaysia Plan.

Of the present total land area, rubber plantations take up about 939 hectares (2,320 acres) while the remaining area houses nurseries, experimental laboratories, midstream and downstream pilot plant factories and housing for employees, two schools, a mosque, a Hindu temple, heritage buildings and recreational facilities.

"We must move with the times, we need new equipment and laboratories to conduct further research and help the industry to grow further," Dr Salmiah in an interview with Bernama.

On concerns that that the storehouse of 85 years of invaluable research on natural rubber may be lost if the Sungai Buloh land were to be redeveloped, she said not all of the property would undergo a revamp.

This is because some tracts of land planted with trees that date back to many decades, including two research expeditions to Brazil in 1981 and 1991 funded by the International Rubber Research Development Board, will be left untouched but converted into a living rubber museum.

(It was also partly for the same reason that the then Subang International Airport was not allowed to be extended into Sungai Buloh in view of the storehouse of rubber research, hence giving birth to the Kuala Lumpur International Airport in Sepang).

Dr Salmiah said from the germ plasms (hereditary material of germ cells) collected from the two expeditions to Brazil, MRB had been able to come up with high-yielding clones from its own research.

"They are very valuable and we have to keep them really within our control," she said, adding that the priceless trees and research could be considered as national treasures or "khazanah negara" as they were the key to the future of Malaysia's rubber industry.

As such, she added, the living rubber museum would enable the trees to be left intact for further research to be carried out.

To safeguard the research undertaken at Sungai Buloh, Dr Salmiah said MRB had also transferred its present R&D activities to four other rubber research stations in Kota Tinggi (Johor), Bukit Kuantan (Pahang), Sungai Sari (Kedah) and Similajau (Sarawak).

Some of these stations were also testing clones derived from the germ plasms on a bigger scale than Sungai Buloh, she disclosed, adding that this meant that the legacy of the Sungai Buloh research would continue to live on at the other four stations.

On other plans for the Sungai Buloh land, Dr Salmiah said MRB had proposed to centralise all its operations, including its headquarters, now located at three different sites in the Klang Valley, at Sungai Buloh so that it would be more cost-effective besides having improved research-related and commercial facilities.

These include having a centre of excellence with better R&D facilities for better research and serving clients better and setting up a Royal Commodity College to produce trained workers for the rubber industry.

"Our (research) backlog is very high because we don't have enough capacity. The redevelopment will change all that because we need to serve the industry better," she said.

In addition, MRB will also provide facilities for the establishment of business clusters in the area.

"When we come out with new technology we want the industry to have the feel of the technology first. They can come and set up their preliminary offices within these facilities and test out the technology," Dr Salmiah said.

"Once they are more comfortable, they can go out and set up their commercial plants," she said, adding that the business cluster facilities would also be useful for overseas rubber-based companies looking to set up shop in this region.

According to Dr Salmiah, the redevelopment of the Sungai Buloh land is a win-win solution for the government and MRB.

"Redevelopment means that the government will benefit from monetising its property while MRB, which has been depending on the government for funding, will get the necessary but increased funding for its expanded activities to further boost the local rubber industry," she said.

-- BERNAMA





Thai floods send rubber to record high
Posted: 08 Nov 2010 03:24 PM PST
The price of natural rubber, the raw material used in tyres, condoms and gloves, has surged to an all-time high after the worst floods in decades hit Thailand, the largest producer.

Physical rubber prices in Thailand have jumped 7.4 per cent in a week to $4.35 a kg on Monday, according to the Rubber Research Institute of Thailand.

That exceeded the level hit in April when rubber broke one of the longest standing price records in commodity markets, surpassing the peak of 1952 when the rise was driven by fears about the spread of the Korean war that triggered panic buying. It has tripled since early 2009.

The sharp rise in prices is hurting tyremakers and forcing increases in the price of tyres. Bridgestone, the Japanese-based company that is the world’s largest maker, said on Friday that it had been “plagued” by higher raw materials costs as well as the strength of the yen.

Some tyre companies have raised prices three times this year, and industry executives say further price increases are likely.

Roy Armes, chief executive of Cooper Tire & Rubber of the US, said he expected commodity prices to continue rising into next year. “We expect raw material costs will continue to be elevated in the near future and have implemented price increases around the globe,” he said.

The most recent jump in rubber prices is the result of heavy rains caused by the La Niña phenomenon that have hit the key producing region of south-east Asia, disrupting tapping.

In Thailand, which accounts for 31 per cent of global natural rubber output, the rains have flooded large swathes of agricultural land. Production was hit earlier this year by drought caused by the opposite phenomenon, El Niño.

The tightness in the rubber market is unlikely to be temporary, analysts warn. Demand is growing apace, driven by voracious consumption in emerging markets, led by China. The country’s consumption of truck tyres in new vehicles – each of which uses about 20kg of rubber – grew 57 per cent in the first nine months of this year compared with 2009, according to Pirelli.

Jom Jacob, senior economist at the Association of Natural Rubber Producing Countries, expects Chinese natural rubber imports to rise 41.5 per cent in the fourth quarter from the same quarter a year earlier.

At the same time, persistent underinvestment into new rubber supply means that tightness is likely to continue. Kona Haque, agricultural commodities analyst at Macquarie, said that “a large proportion of existing rubber-yielding trees in major producing countries were planted in the 1980s, meaning they are at a stage when yields start declining”.

Mr Jacob said: “The possibility for any marked change in supply scenario is remote in 2011 as the yielding area is unlikely to expand before 2012.”

(ft.com)





Rubber price crosses double century
Posted: 08 Nov 2010 03:22 PM PST
Kottayam: The price of natural rubber has crossed the double century mark for the first time and reached an all-time high of Rs. 202 per kg in the domestic market here on Monday.

The price of Ribbed Smoked Sheet (RSS) four grade touched the Rs.200 level on Friday owing to fall in production which again led to decline in supply in the national and international markets.

Business was less in the last week following Deepavali holidays and the production has been hit by rains in many rubber growing areas, traders said.

Natural rubber prices were on a gaining spree for the past few days due to continuous rains in central Kerala and in Malabar region which adversely affected tapping, according to Rubber Dealers Federation president George Vally.

Taking into account the spiraling price trend possibility to hoard the commodity cannot be ruled out by a section of the growers on the assumption that the price will rise further, he said.

Vally appealed the growers to release the commodity in the market and help to stem the price level "unseasonable rains continuing wherever rubber grows including Thailand and Malaysia", he said. On Saturday the price has crossed Rs.200 level and reached to Rs. 203 and closed at Rs. 202 on Monday which was Rs. 16.50 higher than the international price. The present trend in price level will decrease only after a change in climate and arrival of the commodity into the market.

The situation remain the same in other rubber producing countries.

The price which had breached Rs. 180 per kg in July 2010 declined to Rs. 160 by august following the declaration of new import duty regime. The price was stabilized around the same level in September. On October 30 the price has reached Rs. 190 a kg and on Wednesday last it was traded at Rs. 195.

On Thursday the price moved up to Rs. 198.

In the global rubber production during the current year upto June 2010 the output rose to 4439 million tonnes from 4192 MT in the same period of the previous year, registering an increase of 5.96 per cent, Rubber Board sources said.

The consumption on the other hand jumped up by 17.8 per cent, from 4259 MT to 5016 MT, the sources said.

(financialexpress.com)





M'sian rubber to see steady trading this week
Posted: 08 Nov 2010 03:21 PM PST
KUALA LUMPUR: Malaysian rubber is expected to see steady trading this week amid firm demand from tyre manufacturers, dealers said.

They said the price increase would be driven by overseas buying due to the tight supply situation in major producing countries following bad weather.

“The local mart will track closely the Tokyo futures market for clear direction,” a dealer said.

For the just ended holiday-shortened week, rubber prices were mostly higher on strong demand. The market was closed on Friday for Deepavali holiday.

Compared with the previous week, the Malaysian Rubber Board official physical noon price for tyre-grade SMR 20 was 1,231.0 sen a kg from 1,200.5 sen while latex in bulk was 808.0 sen a kg from 796.5 sen.

The unofficial closing price for tyre-grade SMR 20 was 1,242.0 sen per kg from 1,200.5 sen while latex in bulk was 813.0 sen per kg from 794.5 sen. – Bernama

(biz.thestar.com.my)


Covering purchases lift spot rubber


Kottayam, Nov. 9

Physical rubber market recovered partially on Tuesday. The prices of selected grades moved up mainly on covering purchases at lower levels following the bounce back in domestic futures on the National Multi Commodity Exchange (NMCE).

A better closing in the trend setting international markets catalysed the sentiments further.

Widespread rains during the past 48 hours and supply concerns also helped the market to hold on the gains towards the fag end of the session.

The trend was mixed. Sheet rubber increased to Rs 202 (200) a kg, according to traders. The grade closed unchanged at Rs 202 a kg both at Kottayam and Kochi, according to Rubber Board.

RSS 4 firmed up sharply with November series rising to Rs 204.25 (199.97), December to Rs 207.74 (202.36), January to Rs 209.70 (203.61) and February to Rs 211.20 (205.78) a kg for on the NMCE.

The November futures for RSS 3 improved to ¥361 (Rs 198.37) from ¥355 during the day session and then to ¥363 (Rs 199.47) a kg in the night session on the Tokyo Commodity Exchange. RSS 3 (spot) closed at Rs 191.44 (187.21) a kg at Bangkok.

Spot rates were (Rs/kg): RSS-4: 202 (200); RSS-5: 193 (193); ungraded: 190 (190); ISNR 20: 198 (196) and latex 60 per cent: 131 (130).(thehindubusinessline)


Rubber prices cross Rs.200

K.P.M. Basheer
Price of RSS-4 touches Rs.205 a kg
KOCHI: Rubber farmers in Kerala are on cloud nine. On Saturday, the rubber prices crossed the once-unimaginable Rs.200 a kg. On Monday, the price for the RSS-4 quality touched a magical Rs.205.

And, more is yet to come: given the booming global demand for natural rubber and the supply constraints in major rubber-producing countries, the prices would only go up.

Market sources say that since the demand for cars (and hence for tyre, the main raw material for which is rubber) is on the rise in India, the good times might last longer.

Going by the prices of rubber futures (the current February futures price is Rs.2,350 per quintal), the prices are definitely set to rise. And, since over 90 per cent of the country's rubber production is in Kerala, nearly a million farmers here will be the main beneficiaries.

Boon of Monsoon

Rubber prices (prices vary for various grades) have been growing steadily for more than three years now. But this year saw a remarkable rise, particularly after the monsoon rains set in. Weather plays a key role in the production, processing and movement of rubber to the market and to the end-user; supply falls during the rainy period and prices go up.

In Kerala, it has been a long rainy season this year, making rubber tapping hard on most days. In major rubber-producing countries such as Thailand and Malaysia too, bad weather has choked supply.

The impact of floods still haunts production in Thailand.

China's leaping demand

China's voracious consumption of rubber is said to be a major reason for the uptrend in demand and prices. All major automakers and tyre companies in the world have relocated parts of their manufacturing facilities to China or set up new plants there, thus adding to the country's rubber demand.

In India too, tyre-makers have helped to increase domestic rubber prices as new brands of cars hit the roads every few weeks. Tyre companies, pointing out the high prices and low supplies, have pressured the Central government to import rubber. In the seven months ending October 30 this year, they imported 1.31 lakh tonnes of rubber. But, in spite of the heavy imports, domestic prices for natural rubber have kept on rising.

N. Radhakrishnan, advisor to the Cochin Rubber Merchants Association, said the continuing price rise would damage the industry and backfire on the growers in the long run. He recalled that a decade before, the price was just Rs.24 a kg.

The unbridled futures trading and the supply bottlenecks were hampering the trade.

He also complained that the Rubber Board's statistics regarding stock position and production were faulty. It was based on these stock figures that the government took decisions on the volume of imports. According to the board, the stocks held by farmers by end-September were 2.32 lakh tonnes. “The real stocks should be much lower than this,” he said.

“The gap is due to the unaccounted sale and purchase that escape Rubber Board estimates,” he said.(TheHindu)