Natural rubber shipments from Indonesia, the largest grower after Thailand, may rise 6 percent to 8 percent next year from an estimated 2.4 million metric tons on strong demand from India and China, an industry group said.
Output of the commodity used to make tires and gloves may gain as much as 8 percent next year to 2.6 million tons to 2.7 million tons as a rainy season that may last until the first quarter of next year is forecast to have a limited impact to production, Asril Sutan Amir, chairman of the Rubber Association of Indonesia, said.
Carmakers led by Ford Motor Co. are building plants in India, Asia’s second-fastest growing major economy, where car sales are projected by the government to double to 3 million by 2015. Bridgestone Corp. and its Indian rivals are spending $3 billion on new capacity to meet demand forecast by the Automotive Tyre Manufacturers’ Association to expand 10 percent to 106 million tires in the year to March 31.
In the second quarter “the weather would be dry, if it’s normal, our output will also be normal,” Suharto Honggokusumo, executive director of the association, said at the same event.
A longer than normal rainy season this year, caused by the La Nina weather phenomenon, has hurt production of palm oil, cocoa, tin and coal in Indonesia.