ANRPC: Slowdown in China, other countries hurt NR growth

Natural rubber production has dropped nearly 1 percent among member nations of the Association of Natural Rubber Producing Countries (ANRPC), and a softening of Chinese and other emerging markets is largely to blame, the ANRPC said.

Year-on-year, NR production in October 2015 stood at 8.994 million metric tons, down 0.9 percent from October 2014, according to the October 2015 issue of Natural Rubber Trends & Statistics, the ANRPC’s official monthly publication.

“The challenges, in emerging and developing economies in particular, have become more accentuated in the past months,” according to the report. “China’s downturn has become more pronounced and needs close monitoring as it has a direct bearing on the performance on NR trade, which is currently experiencing contraction.”

Low NR prices are causing rubber growers to reconsider their crop, according to the ANRPC.

“Reports from China indicate that between 10 to 15 percent of rubber farmers have left their plantations for better opportunities in the cities,” the October ANRPC report said. “Some Chinese processing factories, especially in the private sector, had to stop producing intermittently due to the risk of fluctuating price or lack of availability of raw materials.”

Year-to-date NR exports from ANRPC member countries are down 1.7 percent, according to the association. Thailand and Indonesia, the world’s two largest NR producers, are especially hard-hit by declining exports, though internal consumption is buoying domestic demand in China, Indonesia, Thailand, Malaysia and Vietnam, the October report said.

Most ANRPC member countries have revised their NR production estimates downward, according to the report. Based on this, the ANRPC now estimates that total NR production in member countries will be 10.937 million tons in 2015, down slightly from 2014’s 10.952 million tons.