Dunlop suspends work at Bengal tyre factory

Dunlop suspends work at Bengal tyre factory
October 8, 2011





Kolkata, Oct 8 (IANS) Work at tyre-maker Dunlop’s factory in Sahagunj area of West Bengal’s Hooghly district was suspended Saturday, five months after a similar temporary shut down in April.

The management of the factory put up suspension of work notice at the factory gate Friday night. About 900 workers are employed at the unit.

The management earlier declared suspension of work at the factory in April this year. Following demonstrations by trade unions, it withdrew the notice and asked the workers to join duty after a few days.

In the notice, the Ruia group company said: ‘The management had invested huge amount of money for the revival of the Sahagunj plant. But with the indulgence of some anti-socials, a section of recalcitrant workers resorted to disruptive activities, including vandalism.’

The management also cited other reasons like ‘exorbitant conversion cost, hefty increase in raw material prices without corresponding increase in tyre prices, continuous losses and cash crunch’ for its inability to run the factory.

It also claimed that the company had no liability to pay wages to the workers during the period of suspension of operation.





Malaysia says 2012 palm oil, rubber output to grow on higher acreage, replanting
Written by HMH | October 7, 2011 | 0 |





KUALA LUMPUR, Oct 7 (Reuters) – Malaysia’s palm oil and rubber production may expand next year on improving yields and higher acreage, the government said in its annual economic report on Friday.

Crude palm oil output in the world’s second largest producer could rise 2.2 percent to 18.7 million tonnes from a projected 18.3 million tonnes in 2011 due to aggressive replanting, the Finance Ministry said in the 2011/2012 economic report.

For the first eight months of this year, Malaysia produced 12 million tonnes of the tropical oil amid signs of weakening yields due to the after effects of El Nino-driven hotter weather in 2010.

By comparison, top palm oil producer Indonesia is expected to produce 23 million tonnes this year on faster expanding acreage.

“The oil palm industry is forecast to grow 7.1 percent over the next five years, driven by further gains in average productivity,” said the report that was issued during Malaysia’s budget presentation.

“Meanwhile, efforts have been intensified to increase rubber productivity to reach the target of two million tonnes output by 2020.”

As the third biggest rubber producer after Thailand and Indonesia, Malaysia is set to harvest 1.04 million tonnes of natural rubber next year, slightly higher than the 1 million tonnes seen for 2011.

That amount is less than a third of Thailand’s rubber production, which projected to rise to 3.35 million tonnes this year, as Malaysian farmers prefer to plant lucrative oil palms.

The report said Malaysia’s oil palm acreage will rise 4.1 percent to 5.1 million hectares this year from 4.9 million hectares in 2010. Land under rubber was likely to expand 2.7 percent to 1.1 million hectares this year from last year.

The acreage expansion for both commodities are due to the opening up of new areas in Sabah and Sarawak states on Borneo island, the report said.

The government currently has a target to open up 30,000 hectares of land annually in both these regions for rubber.

OPTIMISTIC 2011 OUTLOOK FOR COMMODITY PRICES

The economic report said the recent price discount of crude palm oil to soy oil of about $200 a tonne would help sustain demand. Palm oil prices are expected to average 3,200 ringgit ($1,004) this year, up 18.5 percent from last year.

Average prices on the Bursa Malaysia Derivatives Exchange so far this year stand at 3,300 ringgit and traders say there may be some declines if investors continue to sell on concerns the euro zone debt crisis may plunge the world into a recession.

Prices of Standard Malaysian Rubber (SMR) 20 are likely to remain firm and average 13.00 ringgit per kg this year compared to 10.58 ringgit last year.

“The favourable price was supported by stronger demand, particularly from China as well as tight supply due to lower output from Thailand,” the report said.

“Global tyre demand is envisaged to expand at a faster pace, led by strong vehicle sales in China which will help sustain rubber prices.”





India: Rubber imports to slip on weak rupee
Written by HMH | October 5, 2011 | 0 |





New Delhi: India’s natural rubber imports are set to slump in the fiscal year through March 2012, as a weakening rupee has made overseas purchases dearer for tyre makers, worsening a demand slowdown on persistent worries about a wobbly economy.

India, which overtook the US as the world’s second-largest natural rubber consumer last year, will likely import around 1,25,000 tonne of natural rubber in 2011-12, down nearly 30% from a year earlier, government and industry sources said on Wednesday. The imports dipped 11% to 76,116 tonne between April and August, compared with 85,058 tonne a year earlier, data by the state-run Rubber Board showed.

Earlier this year, the government cut the import tax on natural rubber to an effective 7.5% from 20% to boost supplies for tyre makers that were struggling to cope with a shortage of the raw material.

The Automotive Tyre Manufacturers’ Association, members of which account for around 90% of the country’s tyre output, had initially projected a shortfall of around 2,00,000 tonne in 2011-12, expecting higher demand from the country’s booming automobiles sector.

Tyremakers account for more than 60% of the country’s natural rubber demand. India, also the world’s fourth-largest natural rubber producer, expects output to rise 4.6% to 9,02,000 tonne this fiscal, according to the Rubber Board’s forecast.

“Although international prices have softened recently, the rupee has depreciated sharply in recent months. Vehicle sales are also falling during the peak rubber producing season. So imports have been affected,” said Rajiv Budhraja, the director-general of Atma.

The rupee has depreciated by more than 8% since September as investors relied on the haven appeal of the dollar amid the financial crisis, making overseas purchases unattractive for Indian companies. Domestic natural rubber prices of the popular RSS-4 variety were ruling slightly higher at around R2,08,500 per tonne on Tuesday from R1,99,720 a tonne in key supplier Thailand for a comparable variety.

Passenger vehicle sales, including cars, vans and sport utility vehicles, fell 5.7% in August, the second fall in two-and-a-half years, as rising interest costs bite into demand, aiding a fall in imports.

A senior executive with a tyre company said adequate rubber stocks with some companies have prevented massive overseas purchases by them, especially in times of economic uncertainties. The Rubber Board forecasts stocks at 2,71,000 tonne by the end of the 2011-12 fiscal.

India was one of the few countries where consumption rose at a much faster pace in 2010-11 than output because of surging demand for automobiles, driving up prices by more than 50% from a year earlier. Earlier this year, the commerce ministry had even proposed to the revenue department of the finance ministry to allow tax-free imports of up to 1,50,000 tonne of natural rubber in 2011-12 to enable bulk users tide over a domestic shortfall.





Natural rubber prices may fall this week
Written by HMH | October 5, 2011 | 0 |





Reuters - Natural rubber prices in India are likely to ease this week, as weakness in the world market is seen overshadowing lower spot supplies at home and top producer Thailand’s decision to trim supplies, dealers said.

The benchmark November rubber on India’s National Multi-Commodity Exchange (NMCE) provisionally ended 0.3 per cent up at Rs 20,680 a quintal.

On Tuesday, price of the most traded RSS-4 rubber (ribbed, smoked sheet) in the key Kottayam market in Kerala was steady at Rs 20,850 a quintal. In Bangkok, Thailand, the spot price fell by Rs 54 to Rs 20,299 a quintal.

“Apart from the local demand-supply situation, international fundamentals are also affecting prices. Volatility in financial markets and falling crude oil are likely to pull down domestic rubber prices,” said Ibrahim Jalal, treasurer, All India Rubber Dealers Federation.

Excessive rain in Kerala, the country’s top producer, had hampered the tapping process earlier this month.

Tapping has gained pace as the weather is now dry in Kerala, but supplies will rise significantly only after a week, Jalal said.

Tokyo rubber futures ended higher on Tuesday as players bought back contracts and pushed the price back above major support at 300 yen, encouraged by the announcement of plans by Thailand to cut supply to prop up the market, dealers said.

Top rubber producer Thailand aims to cut output by 3.5 per cent this year and will urge Indonesia and Malaysia to follow suit in a bid to prop up prices, which have fallen about a third since hitting a record in February, industry officials said on Tuesday.

The International Rubber Consortium has asked Thailand, Indonesia and Malaysia to curb exports if prices fall further in the wake of a global economic slowdown, a senior Thai official said last week.

Thailand, Indonesia and Malaysia, which together account for about 70 per cent of global rubber output, agreed in December 2008 to slash exports and refrain from selling at below $1.35 a kg, following a 60 per cent drop in prices.

India, the world’s fourth biggest producer, imports natural rubber from Thailand, Indonesia, Malaysia and Vietnam.