Rubber Supply Tightness Lasting Until 2018 May Raise Costs for Tiremakers

Commodities Jul 20, 2011 No Comments

RubberGlobal supply of natural rubber will remain “tight” at least during the next seven years as output gains among key growers fail to match rising demand from tire and glove makers, according to a producers’ group.

Tightness in supply will continue until 2018 as production growth is marginal or moderate,” Jom Jacob, a senior economist at the Kuala Lumpur-based Association of Natural Rubber Producing Countries, said in an interview in Bangkok yesterday. The member countries of the group, also called ANRPC, represent 92 percent of global supply.

A large number of producing rubber trees, which were planted during 1980s, will have to be uprooted between 2012 and 2018, reducing total area of plantations worldwide, Jacob said. Farmers delayed cutting down trees to take advantages of high prices, he added.

December-delivery contract today gained as much as 3.2 percent to 390.9 yen a kilogram on the Tokyo Commodity Exchange.

via Rubber Supply Tightness Lasting Until 2018 May Raise Costs for Tiremakers – Bloomberg.

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Rod Sherkin

Rod is a former senior executive, responsible for Purchasing, for both Pillsbury and Ball Packaging back in the 80’s and 90’s. Since then, he has continued to work in the Purchasing field as both a consultant and founder of the website Propurchaser.com.

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