Rubber sector puts future in focus

Rubber sector puts future in focus
MONDAY, MARCH 28, 2011

BINH PHUOC — Upgrading processing facilities and offering training to farmers will help the rubber industry develop in a sustainable manner, said experts at a sustainable rubber development forum in Binh Phuoc Province last week.
The area of rubber tree plantations increased rapidly from 1980-2010, with an annual average rise of 7.7 per cent in area and 10.7 per cent in output, said Pham Van Tinh, deputy director of the National Agricultural Extension Center.
During the period, rubber yields also rose strongly from 703 kilos per ha in 1980 to 1,720 kilos per ha last year.
Rubber tree development has improved the incomes of more than 130,000 farm labourers and more than 143,000 farmer households, Tinh said.
Although the sector has flourished in recent years, the sector faces problems compared other countries in the region, he said.
The current rush to plant the tree, without suitable land for cultivation, coupled with excessive exploitation, may cause a lower yield and quality in the future, threatening sustainable development for the sector, he said.
"This requires localities to quickly create a zoning plan for rubber plantations and urge farmers to strictly follow a plan and not cultivate the tree on any land when there is a rubber-price surge," said Dr Nguyen Anh Nghia, head of the Rubber Research Institute of Viet Nam's Crop Protection Division.
He also urged localities to improve agricultural-extension activities and give instruction in proper plantation techniques for seed selection, plantation, and harvesting.
Demand for natural rubber in the world market is expected to continue to increase until 2012, however, the planting should not be done indiscriminately, said Tran Thi Thuy Hoa, VRA's general secretary.
Currently, the export price of Vietnamese natural rubber is lower than that of Malaysia, Thailand and Indonesia because importers blamed the inconsistent quality of Vietnamese products, Hoa said.
"The country, therefore, should improve the quality management system for preliminary processing of natural rubber and support farmers to improve the quality of their rubber raw materials in line with national and international norms to enhance the sector's competitiveness," she said.
Supply shortage
The world's natural rubber output this year is expected to increase by 6.2 per cent from last year but is still low compared to the demand for latex, Hoa said.
Supply shortage has pushed up rubber prices in recent years, she said.
Though the price slightly fell this month due to a political crisis in Libya and the earthquake in Japan, it still stands at more than US$5,000 per tonne.
Currently Viet Nam is the world's fourth largest exporter of natural rubber, exporting 782,200 tonnes last year, earning $2.28 billion.
China is the largest buyer of Vietnamese rubber, accounting for 59 per cent of the country's total rubber exports.
Besides latex, last year the country also earned more than $300 million from exports of rubber wood-based products, accounting for about 10 per cent of total wooden products' export revenue, she said.
The country last year had 740,000 ha of rubber plantations, an increase of 62,300ha over 2009, mainly located in southeastern provinces.
The Government has created a master plan to develop the industry until 2015 with a vision to 2020.
Accordingly, the country targets having 800,000ha under rubber cultivation by 2015, producing more than 1.2 million tonnes of natural rubber per year by 2020. — VNS







Japan TOCOM March Rubber Deliveries Highest Since Jan 2007
MONDAY, MARCH 28, 2011

Deliveries against the March rubber futures contract on the Tokyo Commodity Exchange jumped 50 percent from February to 466 lots or 2,330 tonnes, the exchange said on Friday (Mar 25), the highest since 516 lots of deliveries in January 2007.
February deliveries were 310 lots or 1,550 tonnes.
The March TOCOM rubber futures contract expired at 446.4 yen per kg, down 14 percent from February contract's 518.8 yen expiry price.
The benchmark August contract settled down 6.8 yen or 1.6 percent at 429.6 yen.
The newly listed September contract will be the benchmark when it starts trading on Monday (Mar 28).
(Reuters, March 25, 2011)




Rubber Exports to Japan are Safe
MONDAY, MARCH 28, 2011

TEMPO Interactive, Jakarta:Indonesia’s raw rubber exports to Japan are secure despite the closure of several automotive factories in Japan. “There have been no reports of exports being suspended to Japan,” said Suharto Honggokusumo, the executive director of the Indonesian Rubber Producers Association (Gapkindo), in Jakarta yesterday.
Last year, Indonesia’s rubber exports stood at 2.4 million tons and were valued at US$7 billion. The growth of Indonesia’s rubber export volume during 2004 – 2010 was 8 percent. Rubber prices are high on the international trade market at US$ 5.2 per kilogram.




Consumer Tire Demand To Increase
MONDAY, MARCH 28, 2011

"As expected, wholesale tire prices are going up as much as 8% in March as raw materials took a big jump up in January 2011,” says Saul Ludwig in the latest installment of the "Ludwig Report" in Modern Tire Dealer magazine.
“While natural rubber is the most visible as its climb is unprecedented in history, other materials including synthetic rubber, carbon black, steel and chemicals also up,” Ludwig notes.
“I estimate that the total raw material basket cost in January 2011 was at least 30% greater than January 2010 (and up 10% vs. just one month earlier), so manufacturers have no alternative but to move tire prices up.
“Yes, this is tough on consumers,” says Ludwig, “but there is no option for them except to trade down in quality. Your job is to explain to them that quality is the lowest cost in the long run. Fuel efficient tires can offer a partial offset to higher tire prices.
“Despite this tire price inflation, I still expect consumer tire demand to increase as much as 3% this year.”
Ludwig is a managing director with Northcoast Research Holdings LLC based in Cleveland, Ohio. He concentrates on the tire and chemical industries.
(Tyrepress.com, March 25, 2011)




Rubber expected to continue uptrend this week
MONDAY, MARCH 28, 2011

KUALA LUMPUR: THE Malaysian rubber market is expected to continue its uptrend this week supported by higher crude oil prices.
A dealer said rising crude oil prices will make synthetic rubber, a product of crude oil, more costlier.
“Higher crude oil prices will lend support to the market despite increased fears that Japan's disaster could disrupt automobile manufacture and supply from key producing countries,” he added.
For the just-ended week, rubber prices mostly tracked movements on Tokyo and the Shanghai futures markets.
Tyre-grade SMR 20 surged 134.5 sen to 1,528 sen per kg, from 1,393.5 sen per kg previously.
While latex-in-bulk increased 145.5 sen to 1,042 sen per kg on Friday from 896.5 sen per kg, recorded previously. – Bernama.
(Source: http://biz.thestar.com.my/news/story.asp?file=/2011/3/28/business/8358016&sec=business)




Tokyo Futures Mostly Up On Supply Concerns
MONDAY, MARCH 28, 2011

Most Tokyo rubber futures were higher on Monday (Mar 28) as supply concerns provided firm support to the market.
FUNDAMENTALS
The key Tokyo Commodity Exchange rubber contract for September delivery, which debuted in Monday's (Mar 28) session, was at 428 yen per kg as of 0028 GMT, down 8 yen or 1.8 percent from the open.
The previous benchmark for August delivery was up 3.6 yen at 433.2 yen.
Tokyo rubber futures fell on Friday (Mar 25) on technically driven selling as players liquidated contracts after prices failed to break above key resistance at 440 yen. Tight supplies, however, limited the losses, dealers said.
The most active Shanghai rubber contract for May delivery fell 175 yuan to settle at 36,450 yuan ($5,558) per kg on Friday (Mar 25).
Deliveries against the March rubber futures contract on the Tokyo Commodity Exchange jumped 50 percent from February to 466 lots or 2,330 tonnes, the exchange said on Friday (Mar 25), the highest since 516 lots delivered in January 2007.
U.S. crude futures remained steady in early Asian trade on Monday (Mar 28) as fighting persisted in Libya and political unrest continued unabated in Syria, Yemen and Bahrain, supporting oil supply concerns.
The euro started the week on the backfoot following news of a German state election rout for Chancellor Angela Merkel's conservatives, but expectations of an imminent rate hike by the European Central Bank looked set to limit its downside.
(Reuters, March 28, 2011)




Synthetic rubber demand rises by 13% in Dec
MONDAY, MARCH 28, 2011

NEW DELHI, MARCH 28:
The country’s synthetic rubber consumption has risen by 13 per cent to 35,865 tonnes in December 2010, outstripping domestic supply of 9,463 tonnes in the same period, according to the Rubber Board.
Synthetic rubber production and demand stood at 8,912 tonnes and 35,865 tonnes, respectively, in the same period previous year, the Board’s data showed.
Synthetic rubber is mostly used in the manufacturing of tyres in the country. The industry consumed 26,278 tonnes of the produce in December 2010 alone, it said.
According to the Rubber Board, demand for synthetic rubber also jumped significantly by 23.37 per cent to 3,06,620 tonnes till December 2010 of this fiscal, as against 2,48,520 tonnes in the year-ago period.
Meanwhile, the overall production of synthetic rubber has increased only by three per cent to 81,604 tonnes from 79,263 tonnes in the review period, it said.
India, the world’s second biggest consumer of natural rubber, imported 25,087 tonnes of synthetic rubber in December 2010, up by 4.25 per cent from 24,063 tonnes in the year-ago period. Currently, the country has stock of 39,035 tonnes of synthetic rubber.
(Source: http://www.thehindubusinessline.com/industry-and-economy/agri-biz/article1578344.ece)




China natural rubber imports down 14% in February
MONDAY, MARCH 28, 2011

BEIJING (Commodity Online) : China, one of the world’s largest rubber consumers and the largest buyer of natural rubber, imported 107,218 metric tons of natural rubber in February.
According to country’s General Administration of Customs, the figure is 14 percent lower compared to same month a year ago while it was down 27 percent compared to January.
China imported 107,218 metric tons of natural rubber in February this year, down 14.4% compared with the same period of last year.
The February figure is 27% less than that in January, when the country imported 147,382 metric tons of natural rubber.
In the first two months of this year, China's natural rubber imports dropped 14.2% year on year to 254,590 metric tons, said the customs.
China mainly imports natural rubber from Thailand, Indonesia and Malaysia.
During the period from January to February, China imported 230,900 metric tons of synthetic rubber, down 6.42% from the same period of last year. Last month, synthetic rubber imports were 91,250 metric tons.
(Source: http://www.commodityonline.com/news/China-natural-rubber-imports-down-14-in-February-37620-3-1.html)