This entry was posted on Wednesday, November 26th, 2008 at 4:32 pm and is filed under Rubber News. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.
BANGKOK (Dow Jones)–The global long-term demand situation for natural rubber remains healthy despite the current global economic slowdown, the chief executive of Singapore-based R1 International Pte Ltd. said Wednesday.
China, for example, which is the world”s biggest natural rubber consumer, is likely to double its consumption to more than 4 million metric tons by 2020, said Sandana Das.
However, more needs to be done by the industry to promote new uses for natural rubber, Das said at industry event, adding producing countries should work more closely in the future to prevent oversupply, while industry as a whole must work together to try and halt the growing problem of defaults.
“When you consider the Shanghai Futures Exchange traded 421 million tons of natural rubber in 2007, the Tokyo Commodities Exchange 35 million tons and the Sicom 2 million tons, when total global production stands at less than 10 million tons a year, you can see the influence that speculation has on the market.”
Das said there needs to be more research and development to find more uses for natural rubber, which is now solely dependent on the tire industry.
“Demand has been seriously hit in recent months but the steep decline in prices is an overreaction,” he said, adding the confidence in the market will likely stay weak until 2009.
“It”s impossible to forecast a price range in that period but I would expect natural rubber to generally trade in a US$1,000-US$1,200/ton range over the next three months.”
Source: Dow Jones Newswires