18 C
New York
Tuesday, May 24, 2022

Rubber prices to bottom out in 6-12 months-Olam CEO

Feb 20 (Reuters) – Global rubber prices will bottom out in the next 6-12 months as demand from top buyer China could return following an expected run down of its stockpiles, the head of commodity trader Olam International said on Thursday.

Global rubber prices are near their lowest levels in several years on worries about a slowingeconomy in China, forcing the world’s top natural rubber producers to consider joint action to support prices.

But Sunny Verghese, chief executive of Singapore-based Olam, said he expected China to deplete its stockpile in the next 6-12 months.

Chinese inventory in warehouses monitored by the Shanghai Futures Exchange has hit its highest level since 2004, while closely-watched stocks in bonded warehouses in the port of Qingdao are estimated by dealers at around 304,000 tonnes, compared with around 250,000 tonnes in October.

“If China grows at 7-7.5 percent, we should see rubber demand coming back,” Verghese said on the sidelines of a rubber conference in the southern Indian state of Kerala.

“Excess stocks currently present will take 6-12 months to work out, after which we will see a more balanced supply-demand condition.” (Reporting by Rajendra Jadhav; Editing by Jo Winterbottom)

Reuters

Related Articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Stay Connected

11,301FansLike
12,893FollowersFollow
751FollowersFollow
- Advertisement -

Latest Articles

Popular Articles