Short supply to benefit rubber industry
The Vietnam Rubber Association (VRA) said total export turnover last
year reached 2.3 billion USD, surpassing the set target by 800 million
USD.
Although rubber exports last year increased by only
5.7 percent in volume, reaching 750,000 tonnes, it rose by roughly 90
percent in value, according to the Ministry of Agriculture and Rural
Development.
The country's total rubber output this year
is estimated to reach about 780,000 tonnes, an increase of 30,000 tonnes
over 2010, for a turnover of between 2.5 and 2.7 billion USD.
Last year saw latex prices soar dramatically, reaching 2,820 USD per
tonne, a 230 percent surge over 2009. The hike in export prices
benefited many local rubber exporters, the VRA said.
The
Tay Ninh Rubber Company, for instance, earned revenues of over 806
billion VND (40.3 million USD), with pre-tax profits of 292 billion VND
(14.6 million USD), surpassing its target by 152 percent.
Meanwhile, the Phuoc Hoa Rubber Company posted revenues of nearly 2
trillion VND (99.1 million USD), 90 percent more than its annual target;
and a 75 percent increase in post-tax profits at 471 billion VND (23.5
million USD).
Experts attribute the increasing demand for
rubber and higher prices to the global economic recovery, which has
manufacturers of many products including tyres buying more of the raw
material.
However, experts say that the supply of rubber
will fall short of demand until at least the end of February this year
since many large plantations in Thailand, Indonesia and Vietnam
are now in their low production season.
Current reserves
maintained by China, a major consumer, are estimated at only 58,675
tonnes, a drop of 55 percent compared to the same period last year.
China is Vietnam 's leading importer of latex, accounting for 70 percent of its rubber export revenues.
But rubber exports are overly reliant now on China's import
policies because large quantities are exported to the neighbouring
country via border-trade or unofficial channels, said Tran Thi Thuy Hoa,
general secretary of the VRA.
Hoa urged rubber businesses
to increase the product quality and look for more markets instead of
depending too much on the Chinese market.
Businesses should also export rubber to China via official channels, he said.
Of the total rubber cultivation area of 678,000 ha, 65 percent has given latex so far, according to the VRA.
The high economic value of latex has attracted investments from many businesses in many localities.
The Sai Gon Construction Trading Company has developed a project to
cultivate rubber on 20,000ha in central Quang Tri province's Huong Hoa
district. It aims to plant the trees on 1,500ha within this year.
The central province of Quang Binh has 13,000ha under rubber
cultivation and plans to increase the figure to 26,000ha by 2015.
Experts have said that the expected increase in rubber output until
2020 would still be insufficient to meet demand, and the industry is
expected to post higher earnings as a result.
Vietnam , Thailand and Indonesia are among the major suppliers of latex to the international market./.