[07 Jan] Rains in November Hit Global, Indian Rubber Output

Both global and Indian rubber production are poised to take a hit this year owing to unusually heavy rains in November that were extensive in producing regions of countries such as Thailand, Indonesia, Malaysia and India. There have been reports that the rubber plantations in Thailand's southern region and plantations in North Malaysia have been badly affected by flooding caused by torrential rains throughout November.

Shortfall

Consequently, the Association of Natural Rubber Producing Countries (ANRPC) has pointed out that there is a grim possibility of a substantial fall in the production anticipated for the month of November and for 2009 as a whole. The production of natural rubber in Thailand, Indonesia, Malaysia, India, Vietnam, China, Sri Lanka and Cambodia is estimated to have fallen 5.1 per cent during the 12 months ending October.

Production shortfalls have been quite sharp in some of the producing countries such as Thailand that recorded nine per cent fall and resulted in a production shortfall of 2.09 lakh tonnes, Indonesia witnessed a six per cent fall that resulted in 1.12 lakh tonnes fall in production and Malaysia's fall was 21 per cent that left production shortfall of 1.94 lakh tonnes. India, meanwhile, recorded an 8.9 per cent fall which resulted in a shortfall of 61,000 tonnes.

Top 7 contributions

Production by the top seven rubber producing countries such as Thailand, Indonesia, Malaysia, India, Vietnam, China, Sri Lanka and Cambodia account for 93 per cent of the global rubber production.

The shortfall has resulted in a sharp fall in availability in the global markets as major producing countries have cut back on exports. Sharp export cuts have been made by India, Malaysia, Indonesia and Thailand. Just a few countries such as Sri Lanka, Vietnam and Cambodia stepped up exports.

Climate change

Meanwhile, the ANRPC said that climate change has become an issue of serious concern on the supply potential of natural rubber. “Apart form the fall in yield, even the traditional rubber growing regions in major producing countries have been gradually rendered unsuitable for growing rubber,” it pointed out.

Unpredictability of climate is beginning to play a crucial role in limiting the scope for developing and popularising region-specific new clones.

Dearer crude oil

Even as the availability of natural rubber has been lower in the global markets, crude oil prices have been remaining firm to dearer. This has resulted in the price of natural and synthetic rubber creeping up. The price of natural rubber in the markets of Kuala Lumpur, Bangkok, Singapore, Kottayam, as well as the Malaysian latex prices have all been moving up during the last weeks of November.

"Apart form the fall in yield, even the traditional rubber growing regions in major producing countries have been gradually rendered unsuitable for growing rubber"

(Source: irco.biz)