Natural Rubber Price Increases

1st April 2010

From my research and enquiry the primary reason for the current price increase is due to short supply in the global market.
Basically the demand is greater than supply, which in a commodity market pushes prices up.
Factors causing this seem multiple:
The Transport Sector consumption has increased buying both in natural and synthetic rubber.
China, the world's largest consumer of rubber, increased it's buying dramatically december 2009 through to february 2010. India and Malaysia are also buying more.
Normal trading is based on futures contracts which by their nature (an obligation to buy) keep price risks in check. Such contracts are not being placed as yet which has opened up the market to the speculators whose aim is profit.
Recent bad weather has affected yield in Thailand one of the major producers.
Replanting programmes in all Thailand, Indonesia and Malaysia has reduced the current yield.
April-June is seasonally a low yield time.
And the british pound has not been strong in the currency exchange market (our compound is from a british company).

In a commodity market there are many factors at play at all times. It is a complex world of crests and troughs.

Natural Rubber has always been an expensive raw material. Even when we started creating the ecoYoga mat the cost per unit was at least 5 times more costly than plastic mats on the market. In years since prices in the international market have fluctuated with a steady increase. We have tried to absorb as much of this as possible.

So far ecoYoga has been reliant upon the international market for supply. Finance to source out-with has not been available. I do keep my awareness open to alternative sources at all times. Over the years my knowledge has deepened in the manufacturing process: farmers to brokers to factories to consumers; wholesale then retail. The next stage for ecoYoga is to go deeper and integrate this understanding.

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