NR prices skyrocket

WASHINGTON (Nov. 10)—Standard Indonesian Rubber 20—the natural rubber grade used most often by U.S. tire manufacturers—rose over 65 cents a pound free-on-board at the ports of origin, Belawan and Palembang, Indonesia, the week of Nov. 3. These are the highest prices the NR market has seen in several years, ever since the bottom dropped out in 1997 after the devaluation of Southeast Asian currencies. One market source who asked not to be identified said current prices are "a vicious circle." The circle is compounded by supply problems in Thailand, strong demand from China and the refusal of customers to buy forward in hopes that prices will go down, he said.