With Shanghai Futures Exchange, walked into Hainan Rubber Park. Under the sun, the tappers sculpted a spiral texture on the tree, and the milky fresh water trickled into the prepared bowl. In the evening, a sudden shower made Ginger delighted. "Modest rainfall will allow more fresh glue to be cut in the early morning tomorrow."
In the second half of last year, the price of natural rubber went all the way. In 2011, although the natural rubber market was overshadowed by major global geography and political events, due to the decisive role of supply and demand, global rubber prices have been high in the first half of this year. In the near future, natural rubber, which is an important chemical raw material and strategic material, will surely become a resource for the market. This not only heralds the rapid development of the natural rubber industry, but also indicates that a more severe price game will intensify.
"Chilling" to reduce the production of rubber in Hainan
In the rubber plantation, a person from the Hainan Farming and Reclamation Processing Department briefed reporters. “Each tree of rubber here produces an average of 3.03 kg of glue each year, and more can produce 5 kg. Generally speaking, rubber trees grow to 6 to 7 years old. It can be tapped and the production cycle for each tree is 30 to 35 years."
Regarding the impact of the weather on rubber production this year, the source said, “Because of the 'cold winter' this year, the tapping time is later than last year, and the current production may not be like the current period, but we believe that through our later efforts, we will catch up with the same period of production.â€
“Because of the low temperature at the beginning of the year and the influence of overcast and cloudiness, the current production of rubber is indeed lower than the expected output. Compared with normal years, there may be a decrease of 1-2 million tons, but the annual output cannot be judged only by this. If the production conditions in the future are good, the rubber production may rebound," said Zhang Zhifan, general manager of Hainan Zhongya Electronic Trading Market.
Dong Jingjun, Secretary of the Hainan Rubber Board, said: “Natural rubber is more susceptible to natural disasters. For example, a typhoon in 2005 reduced Hainan’s rubber production by 1/3. The company’s production is still in recovery and it is hoped that it will use high-tech means in the later period. To restore production."
For this year's weather, Dong Jingjun answered with "The unprecedented cool weather in Hainan." He frankly said that due to "cold damage", the growth of rubber trees is not as usual. Although Dong Jingjun did not give a specific amount of production cuts, but according to historical experience, there will usually be "amount of price reduction". In response, he said that the basis for judging the market price trend includes not only the “natural conditions†but also the following factors, such as the national economic and financial situation, the prices of petroleum products, the production and sales of rubber companies (tire plants), and international rubber prices. The trend and so on.
Downstream plastic demand slows
Fresh glue cut from the rubber garden was sent to a rubber processing plant and was produced into different types of rubber. Because of the need to rely on ammonia to ensure quality, once into the processing plant, you can smell the pungent smell of ammonia and protein. According to the staff of Sinochem International, “a large-scale processing plant will handle this kind of taste, but some private rubber processing plants are not able to get close to the technology due to unsatisfactory technology.†Indeed, the domestic rubber industry has just started. Production equipment and production technology are still not perfect.
According to reports, 80% of rubber is currently used in the manufacture of automotive tires, and the remaining 20% ​​is used in gloves and other rubber products. However, this year's automobile production and sales figures have declined in May. Does this mean that demand for rubber will also decrease?
In this regard, Yong Cheng Futures analyst Guo Cheng believes that the high price of crude oil has begun to effectively suppress the physical needs of the car. At the same time, due to the implementation of measures in the various economic fields marked by real estate regulation, it has a greater impact on the models represented by trucks. The declining demand for downstream tires will also slow down the demand for rubber.
Shanghai mid-term analyst Fang Junfeng revealed, “Now downstream consumption is not good, and some companies are afraid to pick up the goods.†It is reported that since June, the trading environment in the rubber market in Qingdao Bonded Zone has performed quietly, and the production and sales of domestic downstream industries have been slow. The inventory in the bonded area is slowly consumed. It is reported that the current total amount of rubber stock is about 145,000 tons, which is higher than the stock of 40,000 tons in the same period of last year.
However, the slowdown in demand does not mean a sharp drop in demand. Liu Bin, a China Futures Futures analyst, told reporters, “Although the new vehicle production has declined, the stock of old vehicles is still very large. The demand for rubber for old tires is still increasing.†In addition, according to the Hainan Agricultural Reclamation official, the Tire demand, this year, other plastic demand is basically the same as last year.
In the medium to long term, Guo Cheng said that before 2015, the supply and demand of natural rubber will remain the focus of tight balance, and the contradiction between supply and demand will remain prominent. The rapid development of the automotive industry in emerging economies represented by China and the recovery of auto markets in developed economies such as Europe and the United States will stimulate demand for natural rubber.
Domestic rubber import dependence is too high
It is understood that since 2003, China has become the world's largest consumer and importer of natural rubber. In recent years, consumption has increased at an annual rate of about 10%. "China's rubber dependence on imports is quite high," said Zhu Xiuyan, president of the China National Natural Rubber Association.
The data show that in 2002, the domestic consumption of natural rubber exceeded 1.4 million tons and produced 530,000 tons. The self-sufficiency rate fell from 60% in the early 1990s to 37%; in 2006, it reached 2.56 million tons. Ten thousand tons, a self-sufficiency rate of 23%; in 2010, it reached 3.12 million tons, self-produced 680,000 tons, a self-sufficiency rate of 20%, and the dependence on imports was four-fifths.
Lu Feng, senior director of the Energy and Chemicals Ministry of Shanghai Futures Exchange, said that although rubber is a renewable resource, it has less planted area. Rubber is suitable for growing between 18-24 latitudes. There are few places where rubber can be grown in China, only Hainan, Yunnan and Guangdong.
Due to the constraints of planting area, the self-sufficiency rate of Chinese rubber is very low. Li Mingquan, executive vice president of Hainan Rubber, said that the domestic rubber self-sufficiency rate is too low and seriously threatens national security. Moreover, the domestic rubber industry has a short development time, a low level of industrial development, a messy procurement channel, and a weaker pricing power in the international market. It urgently needs to regulate the market.
Because of the lack of market pricing power, the sharp fluctuations in rubber prices have increased the risk of domestic companies. The listing of rubber futures in the last period allowed companies to reduce their risk through hedging.
"The last period not only made rubber a financial derivative, but also increased China's rubber pricing power. At present, China's rubber trading is very active, and the previous period has played a role in the South-East Asian spot market. We are now signing contracts to a large extent with a period price of Reference, because the spot market is smaller, said Li Mingquan.
Zhu Xiuyan proposed that we must draw lessons from many people’s shortages of industrial raw materials in the international market in order to absorb the lessons learned from people, take precautions, and work hard to improve and perfect a standardized and orderly futures market. Use price formation mechanisms and price information to guide the company's production and business activities; use hedging to lock in costs or benefits, and promote the steady growth of corporate economic efficiency.
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