Vietnam rubber exports to rise 3 pct in 2010

23 Jan, 2010

Vietnam has become a major international supplier of rubber Vietnam expects to increase rubber exports by 3.3 percent to 750,000 tons this year, betting on an economic recovery in its main markets, including top buyer China, an industry official said on Friday.

Vietnam's export projection is small compared with the 2.8 million tons forecast this year by Thailand, the world's top exporter, where rubber prices are at their highest in over half a century. "The higher export target is based on a recovery in importing markets like China and also other countries such as India and Malaysia," Tran Thi Thuy Hoa, general secretary of the Vietnam Rubber Association, told Reuters in an interview. China's economy is likely to grow faster in 2010 than previously forecast, at a rate of 9.5 percent, according to a Reuters poll. China bought 67 percent of Vietnam's rubber exports last year. In total, Vietnam, the world's fourth-largest exporter after Thailand, Indonesia and Malaysia, shipped 726,000 tons in 2009, up 10.3 percent from 2008, government data shows. Other traditional buyers of Vietnamese rubber are Japan, Russia, South Korea and the United States. The association has revised up its export projection for 2010 from the 700,00 tons seen last November, given an expected rise in output and gains this month on regional rubber markets, suggesting demand remained strong. Rising output Vietnam's dry latex output is expected to rise 6.4 percent from 2009 to 770,000 tons, but export prices could be strong, Hoa said by telephone from Ho Chi Minh City. Vietnam's export grade SVR L rose 1.8 percent to $3,045 a ton, free on board Saigon Port, on Wednesday from $2,990 a ton a week ago. Vietnamese rubber prices have risen 11.5 percent so far this year. However, Tokyo's June rubber contract settled 13.3 yen lower at 289.3 yen on Friday, well below a 16-month high of 306 yen struck a week earlier as commodity markets reacted to proposed US government restrictions on banks. Hoa said Vietnam planned to import 130,000 tons of rubber in 2010 for processing and re-export and also to use at home as domestic demand could rise 16.7 percent to 140,000 tons. Last year some 144,200 tons was imported. "With higher prices expected this year, we anticipate the rubber-growing area will also be expanded quickly," Hoa said. The Southeast Asian country could expand its rubber area to 715,000 hectares by the year end, from 674,000 hectares last year, she said. Most new plantations last year were in the Central Highlands coffee belt, industry reports show, but Vietnamese companies are also growing rubber in Cambodia and Laos. Source: Reuters