lobal rubber production up in Q1
Global total rubber supply was 6.2 million tonnes in Q1 2011(January-March), increasing the MAT to 24.8 million tonnes in March 2011, according to International Rubber Study Group (IRSG). The NR supply was 2.5 million tonnes in Q1 2011 or 10.6 million tonnes MAT in March 2011.
The largest producer in the world, Thailand, produced 914,000 tonnes in Q1 2011, 5.1% increase over Q1 2010. Indonesia’s Q1 2011 output reached 721,000 tonnes, a 7.8% increase. Malaysia recorded only 2.1% rise in output to 265,000 tonnes in Q1 2011. Total NR output in the remaining Asian countries grew by 21.4% in Q1 2011, producing 456,000 tonnes.
The global SR supply was 3.6 million tonnes in Q1 2011, a 7.3% growth, and the total production increased to 14.2 million tonnes MAT in March 2011. An estimated 220,000 tonnes of additional capacity came from China and Korea. SR production from China was 790,000 tonnes in Q1 2011, up 7.9%, and 3.2 million tonnes MAT in March 2011.
NR shortage to continue till 2018: ANRPC
According to the latest estimates by Association of Natural Rubber Producing Countries (ANRPC), the total supply from the ANRPC nations during this year is anticipated at 9.959 million tonnes, up 4.9% from the previous year. The supply growth would be marginal during 2012 (between 2.8% and 3.8%). Although the growth is anticipated to accelerate slowly from 2013 onwards, it could reach only up to around 6% by 2015.
The years from 2016 are expected to witness marked slowdowns in global supply of NR. This indicates that the present tightness in NR supply would be continued and the commodity would be in deficit through 2018 even if the demand grows at moderate rates, ANRPC states.
Rise in uprooting rate to hit supply: ANRPC states that a rise in uprooting rate anticipated during the 2012-18 period could result in fall in NR supply. During the period from 2005 to 2010, the uprooting rate varied from 1.5% to 2.5% of the previous year’s yielding area. Compared to these rates, the uprooting rate from 2012 is expected to be higher as the rate remained low during 2005-10 because farmers largely retained aged trees for taking advantage of abnormally high prices.
Besides, a large extent of existing yielding trees was planted during 1980s which was a boom period of planting. The trees planting during that period inevitably have to be uprooted during 2012-18. The resultant reduction in yielding area will be pushing the supply down, says ANRPC.
IRSG forecasts surplus NR output in 2012
The International Rubber Study Group (IRSG) anticipates surplus production of natural rubber in 2012. According to its latest Rubber Industry Report, global NR production is forecast to rise by 5.6% to 10.96 million tonnes in 2011 and by 8.2% to 11.87 million tonnes in 2012, as the trees planted in the mid 2000s start yielding. Consequently, the anticipated deficit of 215,000 tonnes in 2011 is expected to swing to a surplus of 82,000 tonnes in 2012, the Report says.
ANRPC scales down NR supply growth
The Association of Natural Rubber Producing Countries (ANRPC) has scaled down the growth in NR production forecast for the year 2011. The output growth during the full year 2011 now stands revised down to 4.9% from 5.8% forecast a month before and 6.4% growth attained during the year before.
According to the revised estimate, this year’s total output from all ANRPC members is expected at 9.936 million tonnes only as against 10.025 million tonnes previously expected and 9.472 million tonnes produced during 2010. The new revision results from a down-scaling of production by Indonesia and Philippines.
The total anticipated NR production for the second quarter of 2011 (April-June) stands at 2.21 million tonnes as against 2.35 million tonnes during the first quarter. The total consumption for the quarter is estimated to be 1.58 million tonnes (1.39 million).ANRPC estimates a closing stock of 724.000 tonnes by the end of the second quarter of 2011(April-June) as against 860,000 tonnes estimated in the first quarter.
No marked rise likely in NR yield
Despite high prices and commercial introduction of improved clones, average yield expected this year in India is considerably below the level achieved three years before. ANRPC has estimated current year’s productivity to be 1,833 kg per hectare. The country had achieved productivity of 1903 kg/ha in 2008, which declined to 1,752 kg in 2009 and 1,784 in 2010.
The productivity of Thailand is estimated to be 1,700 kg, slightly lower than 1,711 kg estimated in 2011. Malaysia and Indonesia are expected to make marginal improvement in productivity during this year.
3.2% rise in NR exports forecast
ANRPC’s total export of NR this year, including rubber compounds having very high NR-contents, is anticipated to reach 7.709 million tonnes, up 3.2% from the previous year.
During the second quarter (April-June), total export of NR from all member nations of the ANRPC is anticipated to grow at 5.2% annualised rate as against 5% year-to-year rate attained during the first quarter (January-March). Preliminary estimates indicate that export rose on year by 6.4% in April and is likely to rise 6.3% in May. The growth is anticipated to slow down during June to 3.1%.
ANRPC member-countries exported 1.94 million tonnes in the first quarter and the anticipated exports for the second quarter stands at 1.75 million tonnes.
High NR deficit in India forecast
The demand-supply gap in natural rubber in India is widening. The rubber industry estimates that in the current financial year, the domestic production is likely to lag behind domestic consumption by 189,000 tonnes. However, the Rubber Board, India, has projected a deficit of only 75,000 tonnes during this year.
While both the industry and the Rubber Board estimate India’s NR production in 2011-12 to be 902,000 tonnes, they differ on the quantum of consumption. According to the Board, the total domestic consumption of NR would be 977,000 tonnes depicting a growth of 2.9% as against 949,205 tonnes in the last financial year.
However, the Automotive Tyre Manufacturers Association (ATMA) estimates the consumption to be 10.91 million tonnes.
Vietnam sets new record in rubber exports
World’s fourth largest rubber exporter
Vietnam set a new record in shipments in 2010 with 782,200 tonnes worth $2.38
billion. This constitutes an increase of 6.9% in volume and 94.7% in value, according to Vietnam Rubber Association (VRA).
In the first four months of the current year, Vietnam exported about 204,000 tonnes of rubber earning $897 million, up 31.3% in volume against the same period last year. Currently, Vietnam’s exports to China account for as much as 60-70% of the country’s total rubber exports.
Rise in NR use by China, India to be marginal
ANRPC has predicted 6.1% rise in China’s NR consumption from 3.3 million tonnes in 2010 to 3.5 million tonnes in 2011.
Consumption of NR in India is expected to post only a 3.2% year-to-year rise from 944,000 tonnes in 2010 to 974,000 tonnes in 2011.
China imported 2.76 million tonnes of NR in 2010 and the NR import is
expected to go up by 3.1% to 2.85 million tonnes in 2011. India imported 187,000 tonnes in 2010 and is
expected to import only 102,000 tonnes in 2011.
12.5% rise in China’s SR output
Following the boom in automotive and shoemaking industries, China’s synthetic rubber output exceeded 3.1 million tonnes in 2010, representing a YoY increase of
12.5%. The import volume of synthetic rubber accumulated to 1.6 million tonnes, approximately half of the domestic output, according to China Synthetic Rubber Industry Report 2010-2011.
With the completion of synthetic rubber projects planned and under construction in China, the newly increased capacity
will hit 2 million tonnes per year in 2014.
In 2010, 30.5% synthetic rubber
produced in China was SBR and 17.7%
Spurt in India’s duty-paid NR import
The quantum of duty-paid NR import by India has increased from approximately 700 MT in 2008-09 to 26,000 MT in 2009-10.
Duty paid NR import in 2010-11 is estimated to be even higher at 47900 MT.
This means within a short span of two years, duty paid NR import has gone up by 70 times (from 700 MT to approximately 48,000 MT), according to the figures compiled by Automotive Tyre Manufacturers Association (ATMA).
Thailand to set support price for NR
Thailand’s Natural Rubber Policy Committee has agreed to set minimum and
maximum prices for natural rubber. This forms part of a range of measures to stabilise the industry and prevent major fluctuations in price.
According to media reports, the Government wishes to cooperate with Indonesia and Malaysia in establishing a minimum price of 120 baht a kg, while the maximum price should not be so high that it drives users to synthetic rubber.
The Government has reportedly asked Bank of Thailand to support commercial banks in lending to entrepreneurs who
buy rubber and keep their stocks when the rubber price is below 120 baht.
Ford looking to replace SR with dandelion
Automobile giant Ford is looking to replace synthetic rubber with plant-based materials in the manufacture of various components of its vehicles.
According to online reports, Ford has already introduced soy foam and wheat straw components into its vehicles. Now, it’s looking to produce cup holders, floor mats and other parts with the help of Russian dandelions, reports say.
Ford, in cooperation with Ohio State University, will make and test car components created with rubber derived from the dandelion.
Dandelion rubber will be used in parts that are part-plastic, part-rubber, including materials all over the interiors of cars
like plastic trim as well as exterior parts like bumper covers. Some of those
components have rubber content up to 40-50%, reports say quoting a company spokesman.