In 2009, Thailand's natural rubber exports have been hit by the economic crisis which dampened consumer purchasing power, especially demand for cars and thus tires.
The Thai rubber export value has plunged sharply due to a slump in global demand for natural rubber by the automotive industry. For 2010, however, rubber is expected to show a more promising trend in line with the global turnaround. Higher consumer demand will thus be a boon to the auto industry thanks to rising demand for natural rubber used in auto tire production. Amid expected runaway rubber prices due to the impact of unfavorable weather on the output of major rubber producing countries, rubber importing countries may start placing more purchase orders.
It is thus expected that 2010 will be a promising year for the Thai rubber industry.
Thailand is the world's top rubber producing and exporting country and should receive a windfall from brighter exports and higher rubber prices.
Nonetheless, rubber growers and related industries may have to brace for market volatility as experienced over the past few years. Among the risk factors that should be monitored would be unfavorable weather, tougher competition, especially amid increased rubber production by new rubber producing countries. Worse, the slow global turnaround, as evidenced by recoveries in the US and Eurozone, may forestall higher rubber prices. Close attention should also be paid to the strengthening Baht, which may also affect our competitiveness.
(Source: irco.biz)
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