Japan may boost RI rubber imports

Japan may boost RI rubber imports

TOKYO (Reuter): Japan is likely to boost natural rubber imports from Indonesia as a result of delayed shipments and higher prices from Thailand, traders said yesterday.

"We are considering buying Technically Specified Rubber (TSR) from Indonesia, instead of Ribbed Smoked Sheet (RSS) from Thailand," an official of a major tire maker said.

Japan imported 61,611 tons of rubber in March, of which 48,224 tons came from Thailand and 9,486 tons came from Indonesia, according to Finance Ministry statistics.

Shipments of RSS 3 rubber from Thailand have been delayed by up to one month, as rainfall has halted rubber tapping.

There have been no shipment delays from Indonesia.

A widening price gap, with TSR 20 about 15 cents per kg cheaper than RSS 3, is also likely to encourage Japanese end- users to buy TSR, the traders said.

"Although Japanese tire makers have some preferences as to which grades to use to make their tires, they will have to consider buying TSR in light of the widening price gap," a trading house trader said.

"In quality, there is not much difference between TSR and RSS grades, and Japanese makers are able to overcome any quality problems," the trader said.

Japan consumed 692,000 tons of natural rubber in calendar 1995, according to the Rubber Trade Association of Japan.

Sheet rubber (RSS) accounted for 68 percent while TSR was about 31 percent, the association said.

Nearly 100 percent of the RSS comes from Thailand.

The offer price of Thai benchmark RSS 3 to Japan has firmed to 152 cents per kg on a FOB basis, compared with about 138-139 cents at the end of April.

The delayed shipments from Thailand have not affected Japanese rubber production so far, but it has affected Japanese rubber stocks.

Japanese rubber stocks at designated warehouses fell to 35,056 tons as of May 20, against this year's peak of 35,850 tons in mid-April.