Global Jan Natural Rubber Output To Rise 2.9 Pct

Global natural rubber (NR) supplies in January 2011 are estimated to rise 2.9 percent as farmers raised tapping after prices rallied to record highs, the group responsible for 92 percent of global output, said.
"Encouraged by abnormally high NR prices, farmers' harvested over-aged, low yielding trees," the Association of Natural Rubber Producing Countries said in its monthly statement on Tuesday (January 25).
In Thailand, the world's biggest producer, benchmark physical rubber price, RSS3, was offered at a record high on Tuesday (January 25) of $5.82 per kg.
A rise crude oil prices and constrained supply attracted fund money in rubber market, accelerating the price rally, Jom Jacob, senior economist at ANRPC said in the report.
"Increasing concerns over availability of NR, coupled with the high demand for the commodity, have made NR futures an attractive avenue for speculative investors and fund managers," he said.
Higher tapping lifted average per hectare yield in ANRPC region to 1,344 kg in 2010 from 1,315 kg a year ago, despite an increasing proportion of aged trees and constraints caused by climate change, the statement said.
Heavy unseasonal rains in key producing countries like Thailand, Indonesia, Malaysia, China and India had hindered tapping in 2010.
The monthly report also raised the ANRPC's 2010 output estimate to 9.444 million tonnes, up 5.9 percent on year, from an earlier estimated 5.7 percent rise.
As per output targets set by the ANRPC member countries, in 2011 production could rise by 7.7 percent to 10.17 million tonnes.
However, Jacob said natural rubber supplies in 2011 are unlikely to rise beyond 4.8 percent, factoring in a nominal 2 percent annual rate of uprooting.
Many farmers were postponing uprooting of aged trees as the high rubber price has made retaining of low-yielding trees economically viable, it said.
(Reuters, January 25, 2011)