The Latex Crepe 1X hit Rs.618.25, up from Rs.9 and the average price a kilo traded was Rs.615.25 against Rs.610 from the last auction held two days back.
Commenting on the high price scenario, Sunil Poholiyadda, chief executive of Namunukula Plantations, one of the listed rubber producing companies in Sri Lanka said the current rubber prices are mainly backed by adverse weather conditions prevailing in the rubber producing countries.
"January and December generally are the highest cropping months. But the heavy rains to the rubber producing nations such as Thailand and Sri Lanka have badly affected the production in these two months" Poholiyadda said.
"I strongly feel this is a supply and demand situation. The Chinese and Indian auto markets are currently seen an unprecedented growth. Majority of the natural rubber produced in the world are used to manufacture tyres" he added.
The International Rubber Study Group's (IRSG) report on the sale of passenger car tyres indicates that the change in sales had been -3.9 % growth in 2009, but forecasted to be 10.9 percent growth in 2010 and 5.8 percent growth in 2011
In the case of light commercial vehicle tyres, the change in growth had been -3.5 % in 2009 but forecasted growth in 2010 is 11.2 % and 8.1% in 2011. The change in the medium heavy commercial vehicle tyres growth had been -7.6% in 2009 and forecasted sale is 15.4% growth in 2010 and 8.5 % growth in 2011.
He also noted that the along with natural rubber prices, synthetic rubber prices are also on the rise, as the world crude oil prices are gradually pricking up.
According to international media reports, the appreciation of the Yuan also has contributed to the high demand for natural rubber, as it will help the world's second largest economy to cut its import costs on natural rubber,
China, which let the Yuan rise 3.6 % in 2010, is expected to allow the currency to rise about 5.4 % against the dollar in 2011 to combat inflation.
source - www.dailymirror.lk
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