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@ Natural Rubber producers foresee rise in demand (10/11/2017)

10 Nov 2017
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The International Rubber Consortium (IRCo), the operational arm of the  (ITRC), has announced that it expects ‘La Nina’ natural phenomenon to hit South East Asia from November 2017 – January 2018 and bring heavy rains, affecting production of natural rubber in the region.

A meeting of IRCo board of directors on 3 Nov also heard that the natural phenomenon as well as the wintering season which is set to start in the final quarter of 2017, are expected to contribute to a reduction in supply of  to the global markets.

The board, which consists of representatives from ITRC memebers Thailand,  and ,  concluded that with the current supply and demand sitution of NR, prices were “not reflective of market fundamentals”.

NR prices have declined sharply to $1.6/kg in Oct since a hike at the beginning of the year, which saw the figure rise to $2.5/kg.

In terms of demand, the IRCo meeting noted strong sentiment favouring demand for NR, including the projected world GDP growth rate of 3.6% in 2017, compared to 3.2% the year before.

Additionally, the meeting cited imporved automotive sales in major markets as another contributor to a rise in demand in the near future.

According to IRCo, the automotive markets in China,  and Japan grew year-on-year by 4.8%, 3.7% and 7.1% respectively during the first nine months of the year.

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