24
5 OVERVIEW OF NATURAL RUBBER IN INTERNATIONAL TRADE
5.1 Global Perspective
The worlds natural rubber sector has experienced an increasing trend in terms of both supply and demand from the beginning of 2000 through the end of
2010, with the demand increase being even more significant Figure 8. This trend is likely due to the rapid growth in the automotive sector, which has been
the driving force behind the increased demand for natural rubber. In the period of 2000-2010, the volume of worldwide natural rubber production is smaller than the
volume of worldwide natural rubber consumption. This is due to the low productivity of natural rubber plantations in some of the worlds natural rubber
producing countries.
A substantial increase in natural rubber production was seen from 2011 to 2013. The worlds natural rubber production volume is greater than that of
worldwide consumption, allowing for the establishment of a natural rubber surplus. The overall improvement of cultivation technology, infrastructure and
natural rubber replanting systems are a few of the reasons why natural rubber production has increased over the last decade. Additionally, the worlds natural
rubber consumption has also increased in this period, but not as significantly as in the period of 2000-2010. Currently, competition with synthetic rubber is one of
the causes behind only a mild increase in natural rubber consumption, because some industries prefer to use synthetic rubber rather than natural rubber.
Figure 8 World Natural Rubber Production and Consumption, 2000 – 2013 Source: International Rubber Study Group IRSG, 2014
In contrast to the natural rubber situation, Figure 9 shows that the world supply of synthetic rubber tends to be greater than the world demand for synthetic
rubber. This is due to the increased demand of the automotive and medicine sectors. Additionally, synthetic rubber production is not directly dependent on
natural conditions. Therefore, synthetic rubber production does is not reliant upon changes in extreme environmental conditions such as changes in weather,
2000 4000
6000 8000
10000 12000
14000
000 T
on
Year
ProducNon ConsumpNon
25 temperature and rainfall. Thus, the possibility to supply synthetic rubber remains
relatively consistent, while the actual supply continues to increase.
Figure 9 World Synthetic Rubber Production and Consumption, 2000 – 2013 Source: International Rubber Study Group IRSG, 2014
From the beginning of 2007 through the end of 2009, there was a decrease in both the production and consumption of synthetic rubber. The decline in the
world supply of synthetic rubber was caused by the high cost of production due to the extremely high world oil prices. On the contrary, beginning in early 2010,
increasing demand in the automotive sector in various parts of the world, especially in large countries such as China and the USA, led to a considerable
increase in the production and consumption of synthetic rubber. Through 2013, both natural and synthetic rubber has shown an increase on both the production
and the consumption side.
Natural rubber and synthetic rubber are commodities that can be classified as either complementary goods or substitutable goods. These two commodities
can be classified as complementary goods because they have a unique set of advantages and disadvantages, specifically in relation to tire manufacturing
because the two cannot replace one another in most situations. However, in the “green tire” manufacturing process, there is a greater need for natural rubber than
synthetic rubber from 30-40 to 60-80, making the two goods substitutable.
In relation to worldwide natural and synthetic rubber price trends, the two prices seem to be relatively comparable, indicating that the two goods are
competitive in the world market Figure 10. In 2010 and 2011, there was a fairly substantial increase in the natural rubber price,
as a result of low yield. Yunnan, one of Chinas major rubber producing provinces, experienced severe drought last
year that affected production. Indonesia and Thailand, on the other hand, were drenched in heavy rain. In addition, the large demand for natural rubber from
Japan, the USA and China, causing prices to go up.
2000 4000
6000 8000
10000 12000
14000 16000
18000
000 T
on
Year
ProducNon ConsumpNon
Kategori