Tightness in global natural rubber supply may continue for the next two years as demand is recovering and production is unlikely to show any significant increase, analysts and government officials said.
Officials from Thailand, Indonesia, Malaysia and India all reported a decline in output this year due to adverse weather, including prolonged dryness, heavy rains and floods.
And the global industry is at a low point in the rubber production cycle, as there was a large-scale replanting during 2005-2009 and these trees will begin to produce starting only from 2012.
Government and industry officials from Asia and around the world have gathered in Ho Chi Minh City for a six-day meeting organized by the Association of the Natural Rubber Producing Countries, or ANRPC, to chart a course for the next year.
Feedback from member countries indicates production is likely to be at least 6% lower this year, ANRPC senior economist Jom Jacob said. Natural rubber production was around 9.9 million metric tons in 2008.
In 2010 and 2011, production may hover between 9.0 million and 9.5 million tons, ANRPC Secretary General Djoko Damardjati said.
Around 500,000 hectares were planted with rubber trees worldwide in 2005 and 2006, he said. This is likely to boost output by 348,000 tons in 2012 and another 438,000 tons in 2013.
However, there are concerns that newly planted area may not be as high as estimated because Thai officials have said they will likely to revise numbers for new rubber planting since 2002 sharply lower.
This year in Thailand, production is likely to fall to a multiyear low between 2.0 million and 2.5 million tons due to heavy rains, Department of Agriculture Director-General Somchai Charnnarongkul said.
Ageing rubber trees, which yield less, are also weighing on global production.
India's rubber re-planting program is running way behind schedule and 70,000 hectares need to be replanted immediately to improve yield, said Toms Joseph, an economist with the country's state-run Rubber Board.
Most of the trees on that 70,000 hectares are between 28 and 29 years old, yielding less than half of the national average output. Only 9,000 hectares were replanted in 2008, he said.
Trees on close to 38% of India's rubber acreage of 662,000 hectares is above 22 years old, Joseph said.
While production remains low, demand--hit earlier by the global economic recession--is on the path to recovery.
Demand in India and China is quite strong, said Hidde Smit, secretary general of the International Rubber Study Group.
Global natural rubber consumption, which is projected 5.2% lower this year, may rise 1.6% in 2010 and another 4.9% in 2011, he said.
Demand for automobiles and tires is increasing China's rubber needs, said Mo YeYong, associate professor at the Danzhou-based Rubber Research Institute.
Automobiles in use rose 19% on the year in 2008 and are likely to increase by 23% this year, he said. Automobile sales have increased at an average annual rate of 21% during this decade.
Officials from Thailand, Indonesia, Malaysia and India all reported a decline in output this year due to adverse weather, including prolonged dryness, heavy rains and floods.
And the global industry is at a low point in the rubber production cycle, as there was a large-scale replanting during 2005-2009 and these trees will begin to produce starting only from 2012.
Government and industry officials from Asia and around the world have gathered in Ho Chi Minh City for a six-day meeting organized by the Association of the Natural Rubber Producing Countries, or ANRPC, to chart a course for the next year.
Feedback from member countries indicates production is likely to be at least 6% lower this year, ANRPC senior economist Jom Jacob said. Natural rubber production was around 9.9 million metric tons in 2008.
In 2010 and 2011, production may hover between 9.0 million and 9.5 million tons, ANRPC Secretary General Djoko Damardjati said.
Around 500,000 hectares were planted with rubber trees worldwide in 2005 and 2006, he said. This is likely to boost output by 348,000 tons in 2012 and another 438,000 tons in 2013.
However, there are concerns that newly planted area may not be as high as estimated because Thai officials have said they will likely to revise numbers for new rubber planting since 2002 sharply lower.
This year in Thailand, production is likely to fall to a multiyear low between 2.0 million and 2.5 million tons due to heavy rains, Department of Agriculture Director-General Somchai Charnnarongkul said.
Ageing rubber trees, which yield less, are also weighing on global production.
India's rubber re-planting program is running way behind schedule and 70,000 hectares need to be replanted immediately to improve yield, said Toms Joseph, an economist with the country's state-run Rubber Board.
Most of the trees on that 70,000 hectares are between 28 and 29 years old, yielding less than half of the national average output. Only 9,000 hectares were replanted in 2008, he said.
Trees on close to 38% of India's rubber acreage of 662,000 hectares is above 22 years old, Joseph said.
While production remains low, demand--hit earlier by the global economic recession--is on the path to recovery.
Demand in India and China is quite strong, said Hidde Smit, secretary general of the International Rubber Study Group.
Global natural rubber consumption, which is projected 5.2% lower this year, may rise 1.6% in 2010 and another 4.9% in 2011, he said.
Demand for automobiles and tires is increasing China's rubber needs, said Mo YeYong, associate professor at the Danzhou-based Rubber Research Institute.
Automobiles in use rose 19% on the year in 2008 and are likely to increase by 23% this year, he said. Automobile sales have increased at an average annual rate of 21% during this decade.
(Source: irco.biz)
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