Indonesia: Rubber exporters look to sales boost as auto industry recovers

Indonesia's rubber businesses are eyeing a boost in sales and exports next year as the global automotive industry, one of the sectors that the rubber industry relies on, has begun recovering after hit hard by the global economic downturn, the Jakarta Post reported.

Another factor has been that the rupiah has held up well against the US dollar, boosting hopes for a stronger rubber price, Indonesian Rubber Association (Gapkindo) chairman Asril Sutan Sani said during a press conference on Tuesday.

"Indonesia's rubber industry relies on exports a lot, mostly to supply the raw materials needed for automotive tires.

"As some automotive producers have begun recovering, that will be good news for us," he said.

About 80 percent of Indonesia's natural rubber production is exported, the rest being retained to meet domestic demand.

According to data collected by the Gapkindo, the price of type TSR-20 rubber stood at $2.74 per kilogram as of December, about 25 percent higher than in October. In the early months of 2009, the price of rubber stood at below $2 per kilogram.

This year's rubber exports by Indonesia, Malaysia and Thailand - the world's three largest rubber producers with about 70 percent of the world's total production of natural rubber - had been suffering declines in output and sales due to the continuing slump in demand as part of the global downturn.

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