Rubber surge : Demand soars for major Asian grades

TOKYO (Commodity Online) : Global natural rubber prices continued to scale new highs as major producers suffered production losses due to bad weather.
South East Asia, the hub of natural rubber, is experiencing strange weather this season as heavy rains followed by dry weather disrupted tapping to drying.
Meanwhile major rubber grades by Indonesia, Thailand and Malaysia are all enjoying high prices as tyre makers rushed to stock up on fears that prices would rise further.
Japan's largest tyre maker Bridgestone Corp bought Thai RSS3 grade at $4.52 a kg in deals done late on Wednesday.
Indonesia's SIR20 was sold to unspecified buyers at 203 U.S. cents a pound and Malaysian SMR20 was traded at $4.50 a kg.
Natural rubber prices have struck record highs several times in the last two months as prices surged in Tokyo and Shanghai rubber futures.
Benchmark RSS3 prices from top producer Thailand have gone up more than 50 percent so far this year.
Rubber production in Thailand will fall by about 30,000 tons a year for the next six years because of damage from floods, analysts said.
Heavy rain caused severe flooding and landslides that not only destroyed some trees but disrupted tapping, cutting off roads and forcing exporters to delay shipment for weeks.
They said dealers expected steady demand from tyre makers, but top consumer China was likely stay on the sidelines because of high prices.
Rubber inventories in warehouses monitored by the Shanghai Futures Exchange fell 10.7 percent to 55,346 tonnes, the exchange said n Friday, suggesting that tyre makers turned to domestic supply.

(Source: http://www.commodityonline.com/news/Rubber-surge--Demand-soars-for-major-Asian-grades-34368-3-1.html)