The Association of Natural Rubber Producing Countries has cut its global 2012 production forecast to 10.297 million mt from a 10.42 million mt it estimated in early April, the ANRPC said in a report released Thursday.
The reduced forecast was due to a sharp year-on-year fall in production from Thailand and Malaysia in the first quarter by about 9.5%, the ANRPC said in the April edition of its Natural Rubber Trends and Statistics. It said farmers in both countries had reduced their rubber tapping activities due to a fall in spot prices.
In early April, the ANRPC had also cut its forecast from 10.529 million mt.
Spot prices in Thailand fell about 30% in Q1 compared with the same quarter of 2011, the association said, citing poor demand and weaker crude oil prices.
Natural rubber prices tend to follow crude oil prices as oil-based synthetic rubber can be substituted for its natural counterpart.
"The current global economic situation and short-term economic outlook do not support the possibility of a faster growth in natural rubber demand in the second quarter," the ANRPC said.
Q1 exports from ANRPC's member countries fell 6.6% year-on-year, the association said.
However, exports are expected to recover in Q2 as tire makers based in China are expected to rebuild their stocks.
ANRPC member countries account for 92% of global rubber production.
The association comprises Thailand, Indonesia, Malaysia, Cambodia, China, India, Papua New Guinea, the Philippines, Singapore, Sri Lanka and Vietnam.
