Rubber losing bounce on Asia woesThe bleak economic prospects in Asia are expected to lead to lower natural rubber demand and at the same time boost supply in the longer-term, the Economist Intelligence Unit said. The EIU forecast New York RSS One rubber prices to average US$1,100 per tonne in 1998 and $1,010 in 1999 against $1,243 in 1997.
In its latest quarterly commodity report, the EIU said world stock levels were expected to rise as a result and this would push prices much lower than previously anticipated.
It put global production at 6.52 million tonnes in 1998 and 6.71 million in 1999 and up from 6.41 million in 1997. Stocks could rise to 1.96 million tonnes this year and 1.99 million in 1999 from 1.94 million in 1997.
Thailand, Indonesia and Malaysia, the world's three major producers of rubber, had experienced sharp falls in their currencies in 1997. "Three months ago producers could look forward to a gradual improvement in prices in 1998 and 1999," the EIU said. "Now, although localcurrency values...may hold up, prospects for prices in terms of hard currencies have deteriorated," it said. Sri Lanka rubber prices firm Rubber prices were higher at the Colombo auction last week due to strong demand for all varieties of rubber on offer, traders said on Friday.
They said Friday's auction had been called off following a government directive to close offices in the capital's business district on Thursday, part of tight security measures for the country's 50th independence anniversary celebrations.
"The market was very strong on Tuesday with all grades picking up very good demand," said Upali Bandaranaike of commodity brokers Forbes & Walker.The auction is usually held on two days in the week.
Best latex one-X was at Rs 75 per kg after being unquoted over the past two weeks. Number one was at Rs 74 per kg up from Rs 70 a kg last week. RSS1 was at Rs 44.50 per kg after also being unquoted for two weeks.
"There was very good demand despite not much good rubber coming on offer," saidShehan Meegama of John Keells commodity brokers. A total of 317 tonnes of latex crepe, 52 tonnes of scrap crepe and only 15 tonnes of sheet rubber were on offer.
Sri Lanka tea prices ease
Prices at the Colombo tea auction eased on Tuesday as demand settled at lower rates, brokers said. "Low growns had fair demand, but at lower levels," said Anil Cooke of produce brokers Forbes & Walkers. "BOPs declined in value, especially among the poorer grades," Cooke said.
A total of 5.7 million kg was on offer during Tuesday's auction. The anticipated gross sales average was Rs 148 against Rs 149.04 at the last auction, said Forbes & Walker in a report. A trader at Eastern Brokers said there was good demand for high grown teas from the Commonwealth of Independent States (CIS), while active demand was seen from the Middle East and Turkey for low growns. The next auction is on February 11 when 5.5 million kg will be on offer.
Indonesia's cocoa arrivals slow down
Indonesia's cocoa arrivals in the keygrowing area of South Sulawesi fell in January because of drought linked to the El Nino weather pattern and were expected to dip further this month, a cocoa official said on Wednesday.
Halim Razak, deputy chairman of the South Sulawesi chapter of the Indonesian Cocoa Association (ICA), said only between 4,000 and 5,000 tonnes of cocoa arrived in January in the provincial capital of Ujung Pandang from the various growing areas. This was down from about 6,000-7,000 tonnes in the same period last year. "The reason behind the decline is that trees do not produce many beans because of the dry period in the wake of the El Nino last year. In addition, beans being harvested are only remains of the mid-crop," he said by telephone from Ujung Pandang.
Halim also said he believed cocoa arrivals would drop to between 3,000 and 4,000 tonnes in February compared with 4,000-5,000 tonnes in the same period last year.
Tobacco papers show pursuit of teens
Another batch of tobacco documents released on Thursdaysheds further light on how two companies designed marketing tactics geared toward teenagers and minority groups.
Michigan representative John Conyers, the senior Democrat on the House Judiciary Committee, released the papers dating back to 1973, mostly from RJR Tobacco Co. and Brown and Williamson. "These documents make clear that the tobacco industry was targeting blacks, including black teenagers, at the same time the industry knew that tobacco was addictive and caused lung cancer and other smoking-related disease," Conyers said.
Another document, from 1973, said smokers in the 16- to 25-year-old age group would soon be three times as important to the Kool brand as a prospect in any other broad age category. Several batches of documents released recently have highlighted past marketing strategies, and made more and more lawmakers resistant to the idea of granting the industry special protections from certain future lawsuits. Florida judge releases $57mThe first $57 million of the state's $11.3 billiontobacco industry settlement money was released by a Florida judge last Monday after months of wrangling by the industry, the state and attorneys over the funds.
Florida Circuit Judge Harold Cohen of West Palm Beach issued the order authorising the transfer of money to a state-controlled account from an escrow account set up after lawyers who helped negotiate the massive settlement argued over their fees.
Florida officials were elated by the ruling, saying it would allow them to go forward with an educating and marketing campaign aimed at keeping children from smoking. Florida reached its settlement with tobacco makers in August. As part of a 25-year deal, the industry made an initial payment of $750 million. The state has earmarked most of that for an anti-smoking campaign, but the money has been held up by attorneys who say they are entitled to 25 per cent of the settlement, or fees approaching $3 billion.
ICO coffee exports near 79m bags
The International Coffee Organization (ICO) said earlylast week that producing members' exports reached 78.91 million 60-kg bags in the 12 months to December 1997, up from 77.13 million in the same 1996 period.
In December alone, exports rose to 6.86 million bags from 5.85 million in November and 6.64 million a year earlier.
In the first three months of the current 1997/98 (Oct/Sept) coffee year to December, total exports, according to Reuters were down at 17.80 million bags from 20.12 million in 1996/97.
Vietnam's coffee trade hit Vietnam's coffee market has seen a slow recovery last week from the country's Tet lunar new year festival with big buyers holding back because of high prices and smaller traders seeking beans for term contracts. "As their contracts are due for shipment, they come to buy here but farmers do not want to sell much," said a Vietnamese trader.
Vietnam's robusta benchmark Grade 2, five per cent black and broken, was being quoted on Friday at $130-160 below London March futures -- around $1,600-$1,630 per tonne, f.o.b. SaigonPort.
A foreign buyer said farmers were continuing to hold beans in hope of higher prices. Few were in need of quick cash after the new year holidays. Vietnam's Tet festival was celebrated between January 27 and 30. The country produced some 380,000 tonnes of coffee in the November-February harvest period, and more than 350,000 tonnes will be exported, the vice president of the state-owned Vietnam National Coffee Corporation (VINACAFE) Doan Trieu Nhan said last month. But a trader from the central highlands coffee-growing province of Dak Lak disputed the official figures and said the crop volume was closer to 360,000 tonnes.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
