Presentation on theme: "Outlook for the rubber industry International Smallholder Rubber Conference Phnom Penh, Cambodia 24 June 2009 Panel 4 : Prospects Prepared by the Secretariat."— Presentation transcript:
Outlook for the rubber industry International Smallholder Rubber Conference Phnom Penh, Cambodia 24 June 2009 Panel 4 : Prospects Prepared by the Secretariat of the International Rubber Study Group
Presentation content The world economy, the IMF scenario The vehicle sector The tyre sector Long-term aggregate rubber demand forecasts Natural rubber supply potential Natural and synthetic rubber demand The effect of alternative economic growth scenarios
Economic developments Economic activity is represented by Gross Domestic Product (GDP) IRSG uses data from IMF IRSG forecasts for 2009 to 2014 are taken from the IMF IMF published data/forecasts in April 2009 Forecasts for later years are based on IRSG model
World GDP growth, July 2008 and April 2009: recession hits earlier
Tyre sector Tyre sales is the sum of original equipment (OE) tyre sales, determined by the number of vehicles produced replacement (RP) tyre sales, determined by the number of vehicles on the road the number of vehicles on the road
Aggregate rubber demand Aggregate rubber demand in the tyre sector; influencing factors are tyre production and rubber weight per tyre Aggregate rubber demand in the general rubber goods sector; influencing factor is economic development
Rubber consumption 2018: tyres 16.5, GRG 11.2, total 27.7
World rubber consumption (‘000 tonnes) Total rubber volume% growth 200621,810 4.0 200723,045 5.7 200822,299-3.2 200920,817-6.6 201021,3922.8 201122,5025.2 201527,1186.1 201827,6690.7
Natural rubber supply potential About 85% of natural rubber is produced by smallholders Production capacity suitable concept for synthetic rubber, but not for natural rubber
A general framework for natural rubber supply The trend in production will be called normal production Production exceeds normal production at high prices And vice versa
The vintage approach derives and includes The composition of the total area for natural rubber according to the year of planting (the vintages) The average yield profile for a hectare of rubber during its life Technical progress in quality of clones affecting yield profiles of hectares planted in various years 18 April 2009
Projections up to 2018 depend on planting policies
Global NR normal production to reach 13.0 million t. by 2018; actual production higher or lower depending on prices
Confronting supply potential and demand at 2008 market shares
The market Forecasts for consumption of rubber (a lready presented) Production potential of natural rubber (a lready presented) How do these compare?
What are the determining factors driving the share of NR in total rubber consumption In broad terms: Technology: shares may depend on the country or the factory Technology: shares may depend on the country or the factory Composition of the end-uses: cv tyres use more NR than pc tyres Composition of the end-uses: cv tyres use more NR than pc tyres Price ratio of NR over SR Price ratio of NR over SR
Consequences of alternative GDP scenarios Base: GDP scenario as described above Optimistic scenario: higher growth than in the base scenario Pessimistic scenario: lower growth than in the base scenario
NR consumption 2018: between 12.6 and 13.0 million tonnes
The role of the IRSG The IRSG is the only public organisation providing appropriate forecasts for the rubber industry. This is most important in the current uncertain situation. The IRSG needs support and membership from all governments and industries involved in rubber and rubber products in order to be able to provide this service for optimal public and private planning.
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