IRSG warns about global rubber oversupply

Mr. Evans also raised concerns about upstream and downstream challenges. For producers, those challenges include adequate financial reward for farmers and a lack of inward investment for NR, as well as inadequate competitive chemical feedstock supply and bio-sourcing for synthetic rubber.

Problems facing consumers include stable prices, raw material recovery from end-of-life rubber products, and legislation to encourage innovation ability down the value chain.

Besides capacity and planted area expansion, Mr. Evans said he believes excess NR inventory in both producing and consuming countries has an impact on the industry in the shorter term, while longer-term factors include recycling, shale gas access in China, climate change and competition for labor and land in Southeast Asia poses.

Mr. Evans also said he believes that with limited local NR supply in major consumer countries — China and India — and new SR capacity expansions in both countries, synthetic rubber may become the strategic product of choice.

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Jane Ho is a correspondent for European Rubber Journal, a U.K.-based sister publication of Tire Business.