Rubber regains some bounce in May – WB
By Paneetha Ameresekere
Rubber prices recovered in May after falling sharply from January to April this year on account of mobility restrictions due to the COVID-19 pandemic, the World Bank (WB) said in a publication dated 2 July.
Rubber product exports were Sri Lanka’s eighth-largest foreign exchange earner in 2019, according to the Central Bank of Sri Lanka.
Meanwhile, the single largest consumer of natural rubber is China, the WB said, while more than two-thirds of natural rubber supplies are used in tyre manufacturing.
Nonetheless, rubber showed a strong recovery (five per cent) from April to May, i.e. May prices over April, it added.
However, numerous tyre manufacturing facilities have temporarily closed around the world, especially in Europe, the WB said. Production of natural rubber experienced heavy disruptions and exports from the world’s dominant suppliers (Indonesia, Malaysia, Thailand, and Vietnam) were down almost five per cent compared to a year ago in the reference period, the WB said.
These countries account for more than
80 per cent of global natural rubber supplies. Natural rubber prices are expected to weaken in 2020 given the pessimistic demand outlook for the tourism and transportation sector. Natural rubber consumption reached the lowest levels since 2015 towards last year end, it added.