THE WORLD'S RUBBER.

New Zealand Herald, Volume LXVII, Issue 20628, 29 July 1930, Page 8

THE WORLD'S RUBBER.

An association ot' British and Dutch rubber growers has advanced proposals for a limitation of output with a view to raising prices above their present level. The market rate is given as sjd per lb., while the growers consider 9d to be the lowest price the industry can bear. This is borne out by a review of conditions last November, covering the first year of operations iu a market free from the limitations previously imposed by the Stevenson plan. It gave the average price over this period as 10;\d per lb., a rate which, with reduced costs, yielded a profit, but did riot admit of expansion of planting. New capital would not be attracted by the prospect. The Dutch growers have been trying for some time to organise the trade in various ways, with a view to obtaining a better return for the raw output. Late last year plans were made for an international selling organisation to discipline the market. Now, in association with British growers, they propose to control the production end. The prospects of any British-Dutch combination proving effective were suggested by a report the British Rubber Growers' Association produced last year. The figures showed that British capital controlled about one-third of the world's acreage of plantation, and Dutch about one-tenth. Nearly one-half, however, was in Asiatic hands. The owners were described ns innumerable, and of so many different races, nationalities, and degrees of development that any effort to organise them seemed doomed to failure. In such circumstances, it is not easy to sec how concerted action by British and Dutch interests can be particularly effective. Meantime, though the world's consumption of rubber, increases steadily, it has not yet overtaken the output. At the end of last, year it was estimated there were 145,000 tons of raw product stored in London, Liverpool and New York, a condition which perhaps explains the extremely depressed price now quoted. The outlook appears to be that until the demand more nearly overtakes the supply, prices will not be good enough to attract new capital. When the output is fully absorbed, unless planting proceeds meantime, a shortage is certain, because it takes six years at least to bring the. trees into production. That is the. position, an over-supply now, a future shortage possible, and little prospect of successful organisation to meet it.