COLOMBO – Traders in the world’s seventh largest natural rubber exporter Sri Lanka fear that volumes for the first quarter may be low after the first auction in the new year failed to brighten prices, an official said here recently.
Colombo Rubber Traders Association warns that the prices for 2012 are almost half of what was seen in the previous year creating fears that the first quarter will not meet expectations.
“Certain types of crepe rubber were not sold at the auction as they did not get a decent price. We are wary of the uncertain prices, which keep falling almost every week,” a spokesman for the association said.
While global natural rubber production is expected to rise by 3.1 % to 10.4 million tonnes in 2012, local traders are wary that this will result in prices declining.
Sri Lanka’s rubber prices did well till September last year driven mainly by growing demand from India and China. Sri Lanka’s prices are yet to recover after taking a hit in September 2011.
Traders say that prices continued to drop in the last quarter of 2011 even as the highest crop came to the market in October.
Source: Xinhua