Malaysia Can Expect 10 Per Cent Growth In Rubber Exports This Year, Says Mustapa

Malaysia Can Expect 10 Per Cent Growth In Rubber Exports This Year, Says Mustapa
TUESDAY, MAY 3, 2011

KUALA LUMPUR, May 3 (Bernama) -- The outlook for the rubber industry is getting rosier with exports set to rise by at least 10 per cent this year from RM16.028 billion last year, driven by continued strong demand, thanks largely to the global economic recovery.
Against such a backdrop, International Trade and Industry Minister Datuk Seri Mustapa Mohamed has asked the industry to take advantage of the pick up in demand by being ready with competitive products sought by major importing countries.
Last year, rubber exports increased by 24 per cent compared to RM12.478 billion in 2009, he told reporters after a dialogue session with rubber and rubber-based industry associations here Tuesday.
Meanwhile, total sales of rubber products last year amounted to RM13.6 billion, with rubber gloves accounting for 57 per cent of the sales, tyres and tubes at 14 per cent and all other products collectively at 28 per cent.
Mustapa said Malaysia, as the world's third largest rubber producer after Thailand and Indonesia, would increase rubber production to 980,000 tonnes this year from 940,000 tonnes last year, backed by the current market prices.
-- BERNAMA




World will see less of Natural Rubber in 2011
TUESDAY, MAY 3, 2011

COCHIN (Commodity Online): If estimates of The Association of Natural Rubber Producing Countries (ANRPC) are to be believed, Rubber producers can rejoice and consumers are set to pay more for the rubber products.
The ANRPC report says Rubber production this year could be around 10.025 million tonnes, lower than an earlier forecast of 10.060 million tones.
ANRPC uses only official sources for gathering updated trends from the 11 countries which are its members and account for more than 92% of the commodity’s global supply.
Countries which forms ARRPC are Cambodia, China, India, Indonesia, Malaysia, Papua New Guinea, Philippines, Singapore, Sri Lanka, Thailand and Vietnam, which accounts for more than 95 per cent
2011 supply of Rubber from these rubber producing countries are likely to fall by around 0.4 per cent mainly because of a revision of estimates in Thailand, major contributor to rubber.
Thailand revised from 3.375 million tonnes in 2011 from an earlier forecast of 3.430 million tones. The arrest in fall of Rubber could not be sustained despite Indonesia's higher estimates. Indonesia increased its estimated output from 2.955 million tonnes to 2.972.
This could have a cascading effect in automobile industry as its input costs are going to hit badly.




Global natural rubber output estimates cut
TUESDAY, MAY 3, 2011

Global production of natural rubber (NR) is projected to fall this year on bad climatic conditions. The total supply of the commodity, based on the trends since the beginning of this year, is likely to be 10.02 million tonnes (mt), as against the earlier projection of 10.06 mt.
The total supply from ANRPC (Association of Natural Rubber Producing Countries) nations is expected to rise only 5.8 per cent this year as against 6.2 per cent projected earlier. The production estimates were lowered as Thailand, the world’s largest producer, may have a lower production of 3.43 mt from the earlier 3.38 mt, followed by a low production in China also.
The initial trends of 2011 indicate slight improvement in production in India and Indonesia. In India, production is expected to touch 902,000 tonnes as against the earlier projection of 884,000 tonnes and in Indonesia production is likely to increase to 2.97 mt from the earlier 2.96 mt.
The latest concern over the supply is mainly caused by unseasonal heavy rainfall and floods in Thailand and Malaysia during March and April. The concern over supply, rise in demand in China coupled with a set back to the dollar indicate a strong market for NR in the remaining eight months of this year.
The global market has showed signs of correction from mid of April, but this is likely to be reversed in the coming weeks according to latest market trends. In April, imports by China increased 17.4 per cent to 270,000 tonnes. The country accounts for 33 per cent of the commodity’s total global consumption.





Institutional investors bearish on tyre firms as rubber costs soar
TUESDAY, MAY 3, 2011

Soaring rubber prices and a slowdown in growth of commercial vehicle sales over rising auto loan rates are prompting institutional investors to take a bearish view on tyre manufacturing companies in the country, according to analysts.
While they feel earnings of industry leaders like Ceat, MRF, Apollo and JK Tyres, will be under pressure in the coming quarters, these concerns have caused a fall in their shares in the past few days.
Prices of natural rubber have risen sharply from about Rs 65 per kg early last year to Rs 237 on Saturday. The rise in cost of basic raw material will adversely affect margins of the tyre manufacturers, say analysts. MRF, the only tyre manufacturer which has so far announced results, reported a 6% decline in profit in the January-March quarter.
Analysts see a decline in profit margins of other tyre companies as well. Shares of the country's largest tyremaker MRF declined 4% over the past one week to close at Rs 7,045 on Monday. Apollo Tyres, JK Tyres and Ceat have declined 6%, 9% and 12% during the period.




Rubber Falls as China’s Manufacturing Index Declines More Than Forecast
TUESDAY, MAY 3, 2011

Rubber declined almost to a six-week low after data showed manufacturing in China, the world’s largest consumer, fell more than economists forecast and as a slump in silver spurred selling of industrial commodities.
The October-delivery contract lost as much as 3.7 percent to 374.6 yen a kilogram ($4,615 a metric ton) on the Tokyo Commodity Exchange, before paring losses to settle at 386.8 yen as theU.S. dollar advanced against the Japanese currency after President Barack Obama said al-Qaeda leader Osama bin Laden had been killed. Futures fell to a six-week low of 372.2 yen in after-hours trade April 27.
The Purchasing Managers’ Index fell to 52.9 in April from 53.4 in March, China’s logistics federation and the statistics bureau said in an e-mail yesterday. That was below a median forecast of 53.9 in a Bloomberg News survey of 20 economists. The drop indicated that growth may moderate in the world’s second-biggest economy after the government raised interest ratesand allowed faster gains in the yuan.
“The data showing a slowdown in the Chinese economy raised concern that the nation’s raw material demand may weaken,” Kazuhiko Saito, an analyst at broker Fujitomi Co. in Tokyo, said today by phone.
Zhang Liqun, a senior researcher at the State Council’s Development Research Center, said in a statement yesterday that the data show an increased likelihood that growth will slow. China’s gross domestic product expanded 9.7 percent in the first quarter from a year earlier and theWorld Bank last week forecast a full-year expansion of 9.3 percent.
Fastest Inflation
Premier Wen Jiabao’s government aims to counter the fastest inflation since 2008 and cool a real-estate market that has been at risk of price bubbles. Credit Suisse Group AG says the nation’s fifth increase in benchmark rates since the global financial crisis may come as early as today, a Chinese holiday, less than a month after the previous move.
Rubber was also sold as silver futures on the Comex in New York plunged as much as 13.2 percent, spurring investor sales of industrial raw materials, Saito said. The precious metal slumped as CME Group Inc., the Comex parent, increased the minimum amount of cash that traders must deposit for speculative trades.
Silver for July delivery dropped to $42.2 an ounce before trading at $44.825 an ounce at 3:52 p.m. Tokyo time. The CME increased the so-called initial margin by 13 percent to $14,513 per contract from $12,825 after the close of business on Friday. Margins were $4,250 a year ago.
Weak Yen
The yen weakened against the dollar, raising the appeal of yen-denominated futures, after Laden’s killing was announced. The yen slipped as much as 0.6 percent to 81.69 per dollar from 81.19 on April 29.
Rubber also declined amid speculation that supply from Southeast Asian producers will expand, Saito said. Natural rubber output will increase in the coming weeks as farmers resume harvesting after the traditional low-production season, easing a “tightness” in global supplies, theAssociation of Natural Rubber Producing Countries said in a report last week.
Production from its member countries, representing 92 percent of global supply, may climb 10.5 percent to 2.3 million tons in the three months through June, the group said in a monthly bulletin. Output in the first quarter is estimated to have advanced 6.1 percent to 2.27 million tons, the group said.