Tue, 27 Sep 2011

Jakarta (ANTARA News) - The world natural rubber price which in 2011 averaged US$4 per kg is predicted to remain high within a range of US$4-US$4.5 per kg in 2012, a rubber businessman said.

"The price will depend on supply and demand as well as on weather conditions and the economic situation affecting the market," TB Chandra of the Indonesian Rubber Businessmen`s Association (Gapkindo) said.

He said about 70 percent of global demand for rubber came from the East Asian region so that world demand would not be affected by the economic slow-down in Europe and the United States.

Chandra said demand for rubber in Asian countries such as China and India was expected to remain high.

The two countries` economic growth was predicted to reach nine percent in 2012.

Operations Director of PT Kharisma Pemasaran Bersama Nusantara, Iman Bimantara, also said that with China and India projected to enjoy high GDP (gross domestic product) figures, their demand for rubber would also remain big.

"The situation in the US and Europe will also affect the rubber price but because of the high demand in China and India, the world`s rubber prices will not come under pressure," he said.

Chandra said in 2011 world natural rubber production was estimated to reach between 11.55 million tons and 11.66 million tons while world demand for natural rubber would be 11.40 million tons.

In 2010, world natural rubber production could not meet market demand so there was a shortage of 400,000 tons, causing the the rubber price to rise to US$4.95 per kg.

At the end of 2010, the world`s rubber stocks totaled 1.29 million tons or enough to meet demand for 1.5 months only while actually at the end of the year the stocks should be able to meet e demand for a period of 2.5 months.