Virus risk forces top Vietnam rubber producer to seek new buyers
Vietnam’s top rubber producer is actively pursuing buyers outside of China on fears that the coronavirus will erode demand from its biggest customer, according to a person familiar with the matter.
Vietnam Rubber Group Ltd., the world’s third-largest listed producer of rubber, is looking for new markets and is considering cutting export prices, the person said, asking not to be identified as the matter is private. The company is concerned that demand from China, which accounts for half of the group’s shipments of latex, will fall, the person said.
The rubber industry has been roiled this week as the spread of the virus in China clouds the outlook for global growth and especially auto production and tire demand. More than a dozen Chinese provinces announced an extension of the current Lunar New Year holiday by more than a week, with carmakers from Toyota Motor Corp. to General Motors Co. saying production will be halted through at least Feb. 9.
Vietnam Rubber Group shares slumped 6.1% in Hanoi on Friday, its biggest drop since Dec. 24. The stock lost about 5% on Thursday after markets resumed trading following the Lunar New Year holiday.
The company exports about 70% of its rubber output. Most shipments to China are natural rubber, while rubber products account for a small portion. About 70% of all Vietnamese rubber exports goes to China, according to Vietnam’s customs data.
Source: Bloomberg
Latest News
-
Viet Nam Is Only Economy in ASEAN to Attain Positive Growth
16 Nov 2020Viet Nam is the only country among major ASEAN economies to have attained positive growth in the first nine months this year despite complicated...Read more -
Taking on the circular economy in oil and gas
09 Jun 2021Encouraged by the concept of the circular economy, the oil and gas industry can take waste by-products to create new, useful products. With the...Read more -
Rubber exports to China accounted for 77% of the total turnover in 2020
20 Feb 2021AsemconnectVietnam – Vietnam exported a total of 1.75 million tonnes of rubber in 2020, bringing in 2.38 billion USD, a year-on-year increase of 2.9% in...Read more