Rubber Seen Poised for Glut on Weaker Chinese Growth

Rubber May 23, 2012 No Comments

RubberSupplies of rubber, used in tires and gloves, are set to exceed demand, reversing a shortage and pressuring prices as growth slows in Europe and China. Futures fell the most in two weeks.

Futures have plunged 50 percent from a record in February 2011 as Europe struggled with its debt crisis and China expanded last quarter at its slowest pace in almost three years.

Chinese vehicle sales dropped 1.3 percent in the first four months, the worst performance since 1998, according to industry data. Price declines will cut costs for tire makers such as Bridgestone Corp. and Michelin & Cie and threaten farmer incomes in Thailand, the biggest producer and exporter.

The contract for October fell 3.9 percent today to 269.60 yen a kilogram ($3,395 a ton) on the Tokyo Commodity Exchange. That was the biggest drop for the most active contract since May 9.

via Rubber Seen Poised for Glut on Weaker Chinese Growth – 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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