Output of natural rubber from so- called key producing countries is forecast to grow 8 percent to 10 million metric tons in 2011, the Association of Natural Rubber Producing Countries said in a monthly bulletin. The group’s members account for 92 percent of global production.

Natural-rubber supply from key growers may expand 6 percent in the first quarter as high prices attracted farmers to tap trees during the low-output season, the bulletin said.

Demand for natural rubber in China, India and Malaysia, which account for 48 percent of global usage, is expected to increase this year, the bulletin said. Demand in China, the largest user, may gain 9.1 percent to 3.6 million tons; India’s usage may gain 5 percent to 991,000 tons and consumption in Malaysia may rise 7 percent to 490,000 tons.

Rubber futures in Tokyo have gained 15 percent this year, extending last year’s 50 percent rally, as rising car sales led by China and India boost demand. The price reached an all-time high of 537.7 yen per kilogram on Feb. 18.

Source: Bloomberg

[Dow Jones] Physical prices of Thai USS3 rubber steady at THB173.30-THB178.84/kg vs THB177.30-THB177.73/kg yesterday; price is higher at Surat Thani as arrivals were below 10 tons. USS3 prices are weighed by Tocom coming off record high levels, but exporters” concerns are on supplies as Thailand is in the low-production season. “I wonder how much we”d be able to get tomorrow,” says a trader. Outside the central markets, factories are paying around THB180-THB182.5/kg. Sales in Thailand”s three central markets total around 68.1 tons Thursday versus 109.6 tons Wednesday: 35.1 tons in Hat Yai, 6 tons in Surat Thani, 27 tons in Chandee.

Source: Dow Jones

[Dow Jones] Tocom rubber futures settle 1.7% lower in a day of volatile trade that saw prices rebounding as much as 3.2% early in the trading day. Tumbling Shanghai rubber prices pulled Tocom rubber prices into negative territory. Chaiwat Muenmee, an analyst at DS Futures in Bangkok, says tightening fears in China and spillover from the Middle East crisis contributed to the declines; he adds that Tocom may fall further, to Y450/kg, noting China”s natural rubber imports in January declined 14% on year, according to Customs data this afternoon. The benchmark August rubber contract settles Y8.5 lower at Y478.8/kg after moving in a wide range: Y469.3-Y502.7/kg.

Source: Dow Jones

TOKYO, Feb 22 (Reuters) – Key Tokyo rubber futures tumbled on Tuesday, pulled lower with a Shanghai market slide on concerns about demand from China, the world’s top rubber consumer, while traders turned to physical prices for clues on the market’s trend.
* The benchmark Tokyo Commodity Exchange rubber contract for July delivery <0#2JRU:> settled down 18.2 yen or 3.5 percent at 506.7 yen per kg, posting its biggest daily loss in about a month.
* The contract, which hit a record high of 535.7 yen last week, fell as much as 5.1 percent to 498 yen, falling below 500 yen for the first time in two weeks.
* Deliveries against the expiring February rubber futures contract edged down to 310 lots, or 1,550 tonnes, from January’s 314 lots, TOCOM said on Tuesday. [ID:nTOE71L03Y]
* The newly listed August contract will be the benchmark when it starts trading on Wednesday.
* The most active Shanghai rubber futures for May delivery closed on Tuesday at 39,700 yuan ($6,040) per tonne, down about 2 percent from Monday’s close of 40,500 yuan. It fell as much as 2.8 percent earlier in the day. Volume stood at 890,908 lots. The contract hit a record high of 43,500 yuan on Feb. 9.
* “Shanghai futures have been sluggish even when TOCOM was extending gains to record highs, and this widening gap has made TOCOM expensive relative to Chinese prices,” said Kazuhiko Saito, chief commodities analyst at Fujitomi Co Ltd.
* “There were expectations that Chinese buyers would return after the Lunar New Year holidays, but demand did not pick up as strongly as previously thought, capping Shanghai prices,” he said.
* Chinese tyre makers are slowing their imports due to high overseas prices, traders said.
* Asian physical rubber prices stayed high, with the benchmark Thai RSS3 hovering around $6.5 per kg, traders said.
* “The offer price for Thai physical rubber is key in determining the outlook for TOCOM and Shanghai,” Fujitomi’s Saito said. “If the physical offer prices come down, then there is more downside scope for TOCOM to narrow the gap with Shanghai. If physical prices remain steady, then Shanghai rubber may start to climb and pull TOCOM higher.”
* Record high rubber prices are luring foreign rubber exporters and consumers to invest in new plantations in Cambodia, where output could double in five years. [ID:nSGE71K00J]
* Thailand, the world’s biggest rubber producer and exporter, is likely to boost natural rubber production 10 percent this year to 3.3 million tonnes and exports are expected to rise 7.4 percent to 2.9 million tonnes, said a Thai Rubber Association official. [ID:nSGE71J00T]

Source: Reuters

[Dow Jones] Physical prices of Thai USS3 rubber rise to THB183.64-THB183.93/kg vs THB182.28-THB183.28/kg Thursday; the central markets were closed Friday for a public holiday. Outside the central markets, factories are paying THB185-188/kg. USS3 prices are likely to stay high as major producer Thailand enters low-production wintering season, say traders. Sales in Thailand”s three central markets total around 109.2 tons Monday versus 76.3 tons Thursday: 46.2 tons in Hat Yai, 10 tons in Surat Thani, 53 tons in Chandee.

Source: Dow Jones