Archive for February, 2010

Natural rubber latex prices closed the week over 740 sen/kg, up 21.5% since year-to-date and over 70% from this time last year (Source: Malaysian Rubber Board).

Natural rubber latex prices surpassed 700 sen/kg today to close at 703.  The rally marked the first time prices closed above the 700 milestone since July 2008, when rising oil prices, new regulatory standards, and factory shutdowns sent disposable glove prices soaring to record highs.

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Business Standard:  NR prices rise on reports of low output

Natural rubber supplies dropped more than 5% in 2009, according to a report published by the Association of Natural Rubber Producing Countries.  The four largest rubber producing countries–Thailand, Indonesia, Malaysia, and India–all experienced declines in production.  In Malaysia alone, production fell more than 22%.

Experts expect prices to remain high, with demand surging and supplies predicted to remain low as producers fight difficult climate conditions.  With producers enjoying the high prices, few believe intervention will come even if prices escalate further.

A key material used to produce latex gloves, natural rubber latex prices directly impact glove prices.  Rising natural rubber latex prices can also impact the price of synthetics, such as nitrile gloves, as buyers seek more cost-effective alternatives in lieu of latex.

Driven by rising ethylene costs and weakened supplies, polyethylene prices have climbed nearly 8% this year, according to an article published in Purchasing.  Recovering demand has been stymied by factory shutdowns and cold temperatures, which hampered January ethylene production.

Polyethylene producers continue to seek further increases, but with added ethylene capacity expected online in the next several months, it remains unclear whether these increases will materialize.