GOOD NEWS FOR RUBBER ENTERPRISES

The rubber price increased by over 25%, the export value increased by 110%.

According to the Ministry of Industry and Trade, the rubber export value in the first 2 months reached 320,000 tons, going up by 90%; the value reached 516 million USD, going up by 110% over the same period last year. Particularly in February, rubber export reached about 130,000 tons, worth 211 million USD; increased 68% in volume and 86% in value over the same period last year.

Vietnam mainly exports natural rubber to China, India, and South Korea, only the Chinese market accounts for 76%. In 2020, Vietnam's rubber export turnover to this market will reach USD 1.78 billion, an increase of 18.1% compared to 2019; the volume of 1.36 million tons, up 17.3%.

Also, natural rubber prices recorded a positive sign. The average export price in February increased by 0.9% over January 2021 and by 10.9% over the same period last year to $ 1,623/ton.

Dong Phu Rubber Company said that the average selling price of rubber in the first 2 months reached 46 million VND/ton, up 25.5% over the same period last year. In which, the export price and the entrusted export price is 43.37 million dongs/ton; domestic consumption price is 48.2 million dongs/ton. Tay Ninh Rubber Company recorded an average selling price of 46.3 million VND/ton, an increase of 35% compared to the average price of 2020.

Futures prices on the Tokyo market recorded a sharp increase to nearly 330 JPY/kg in January then cooled down, as of March 12, they reached 272 JPY/kg, more than double the record low of 130 JYP/kg is set in April 2020.

According to Dong Phu Rubber Company, the average selling price of rubber in the first 2 months reached 46 million VND/ton, going up by 25.5% over the same period last year. In which, the export price and the entrusted export price is 43.37 million dongs/ton; domestic consumption price is 48.2 million dongs/ton. Tay Ninh Rubber Company recorded an average selling price of 46.3 million VND/ton, an increase of 35% compared to the average price of 2020.

Futures prices on the Tokyo market recorded a sharp increase to nearly 330 JPY/kg in January then cooled down, as of March 12, they reached 272 JPY/kg, more than double the record low of 130 JYP/kg is set in April 2020.

Source: https://tradingeconomics.com/

According to the Association of Natural Rubber Producing Countries (ANRPC), the demand for rubber in the coming time will increase due to the forecast of China's economy - the leading rubber consumer in the world - continuing to improve, especially in 2021. At the same time, automakers boosting output also makes the demand for natural rubber increase. While supply might be disrupted due to bad weather, production in major exporting countries such as Thailand, Indonesia, Vietnam, and Malaysia may decrease when winter starts, rubber trees give a low yield of latex. As a result, the selling price of rubber is expected to keep rising.

The International Rubber Research Organization (IRSG) forecasts that world demand for natural rubber in 2021 will recover thanks to the growth of the commercial vehicle segment, mainly due to emerging markets. Meanwhile, demand for synthetic rubber in 2021 is forecast to increase by 10.2% compared to 2020 thanks to strong demand for gloves and other products during the season.

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Business plans to reduce profits

In the report sent to the Annual General Meeting of Shareholders, the leader of Phuoc Hoa Rubber said that the rubber price in the first months of the year was quite high. However, it is still a hard year. From 2021, rubber plantation projects are not exempt from land rent during the capital investment period. The export growth will not be good since China showed signs of slowing down.

Accordingly, the business has set a plan to consume 34,000 tons, increasing by 7%; the average selling price was 34 million VND/ton, going up by 2% compared to the implementation level in 2020. Particularly in the first quarter, the enterprise set a target of consuming 6,130 tons of dry latex, fulfilling 18% of the plan year; the Average selling price is 43 million VND / ton, 26% higher than the annual average.

Besides the rubber segment, Phuoc Hoa has also promoted the industrial zone real estate segment in recent years. Business leaders assessed that investment attraction in industrial zones in Binh Duong province mainly came from Japan, Korea, Singapore, China. However, due to the Covid-19 epidemic in the first months of the year, it is difficult to attract investment.

Therefore, the Board of Directors plans to submit parent company revenue plans to VND 1,921 billion, going down by 13.6%; profit before tax was 751 billion (dropping by 25%).

Dong Phu Rubber also set a business plan in 2021 based on the average selling price of VND33.3 million / ton, going down by 6% compared to the implementation of 2020; output consumption 13,000 tons, decreasing by 14%. Revenue from rubber consumption and services reached 821 billion VND, gross profit was 187 billion VND; increase 6% and decrease 8% compared to the previous year.

Although in January recorded an average selling price of 46.3 million VND / ton, Tay Ninh Rubber set a business plan for 2021 based on an average of 33 million VND / ton, down 5% compared to the average of the whole year. 2020. Accordingly, the target of total revenue is 301 billion VND, decreasing by 30%; profit before tax 57 billion, dropping by 49%.

Tan Bien Rubber Company plans to consume 9,500 tons by 2021, going down by 32% compared to 2020; revenue from rubber consumption is 304 billion dongs, down by 33%. Particularly for the first quarter, the enterprise expects to consume 1,625 tons, implementing 17% of the year plan; revenue is 66 billion, reaching 22% of the plan; average selling price is 40.74 million dongs/ton.

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