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Rubber production growth rate slowing.

The strong growth in worldwide rubber production appears to be slowing, according to the International Rubber Study Group. Since August, 2002, the moving annual total (MAT) of synthetic and natural rubber supply increased from 17.55 million metric tons to 19.39 mmt in February 2004. During this period, the year-on-year (YOY) rate of change improved from a decline of 2.4% to a growth rate of 7.6%, before slowing down in February to 5.4%, the IRSG reported.

Both NR and SR production are expected to increase this year, but at a slower rate. SR production growth is expected to be comparable to the expansion of consumption. The IRSG sees production increasing 4.8% this year and 3.9% in 2005. The MAT of SR stood at 11.46 mint in February, suggesting a growth rate of 4.2%.

Increasing consumption and rising exports will lead to increases in SR production in eastern Europe. The IRSG says the relatively higher growth prospects for SR production relative to consumption in North America reflect the weak dollar's impact on exports. The opposite situation of a rise in SR imports is foreseen for Asia/Pacific.

Higher NR prices, evident over the past two years, are expected to influence a sharp increase in output this year and next. World total rubber production is forecast to grow at 7.2% this year and 5.2% in 2005. This rise is more sharp than projected consumption and will likely be a factor in pricing. In February, world NR production reached a MAT rate of 7.93 mint with a YOY growth rate estimated at 7.1%.

Growth in NR production will likely come from Thailand, Indonesia and Malaysia.
Synthetic rubber production

 2002 2003 2004 *

Canada 150 158 159
U.S.A. 2,150 2,146 2,155
Argentina 48 57 57
Brazil 382 395 395
Mexico 182 190 189
Austria 5 5 5
Belgium 104 104 105
Finland 40 40 40
France 681 727 721
Germany 869 883 876
Italy 250 247 250
Netherlands 176 176 178
Spain 88 88 89
Sweden 37 38 36
U.K. 281 286 286
Bulgaria 20 20 21
Czech Rep. 88 89 90
Poland 87 94 95
Romania 15 12 12
Russian Federation 919 1,071 1,095
Turkey 36 35 35
F.R. of Yugoslavia 25 25 25
Other Europe 4 4 4
South Africa 68 79 79
Australia 8 10 10
China 1,133 1,272 1,287
India 77 85 86
Indonesia 34 35 35
Iran 66 72 72
Japan 1,522 1,595 1,590
Rep. of Korea 678 700 700
Taiwan 523 519 531
Thailand 122 128 129

Total world 10,870 11,375 11,462

* Moving annual total to February 2004

Source: IRSG

Natural rubber production

 2002 2003 2004 *

Brazil 96 97 98
Guatemala 40 41 41
Other Latin America 23 23 23
Cameroon 58 62 62
Cote d'Ivoire 120 126 126
Ghana 12 12 12
Liberia 109 110 110
Nigeria 45 46 46
D.R. of Congo 8 8 8
Other Africa 11 11 11
Bangladesh 5 5 5
Cambodia 47 47 47
China 468 477 477
India 640 690 690
Indonesia 1,630 1,761 1,810
Malaysia 589 678 681
Myanmar 30 30 30
Papua New Guinea 4 4 5
Philippines 74 78 78
Sri Lanka 91 93 93
Thailand 2,615 2,873 2,931
Vietnam 373 384 383

Total world 7,270 7,880 7,928

* Moving annual total to February 2004

Source: IRSG
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Title Annotation:Market Focus
Publication:Rubber World
Date:Mar 1, 2004
Words:587
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