LONDON (Nov. 7) — Natural rubber prices are set to rise by more than 30 percent this year vs. last, followed by increases of nearly 10 percent in each of the following two years, according to the London-based Economist Intelligence Unit. Prices are running well ahead of predictions and will continue to rise in an under-supplied market, the group said in its latest quarterly commodity report. Strengthening consumption is the key driver in the NR market, which is set for annual growth of at least 5 percent from this year to 2005, said the EIU study. "We take an even more bullish view of prospects for the forecast period than we did three months ago, in view of the growing imbalance between supply and demand," EIU said. The group's upward revision has been prompted by developments in China, where first-half imports of 580,000 metric tons were 56 percent above their level for the same period in 2002. This growth, which is closely linked to the development of the automotive industry in China, will continue, "but less explosively, as measures to prevent the economy overheating take effect," EIU stated. "Nevertheless, the rapid growth in China's demand for natural rubber can be expected to continue for at least the next two years," the group forecast.
Rising natural rubber prices will continue to climb into 2005
Rubber & Plastics News wants to hear from its readers. If you want to express your opinion on a story or issue, email your letter to Editor Bruce Meyer at [email protected].