I >!•.« I. M 1:1 l< 1, 1''14. ] 



THE INDIA RUBBER WORLD 



161 



Trans-Atlantic Notes. 



[Situation in Plantation Rubber; tin- War's Rubber Requirements; Views on Overprodu, 



S[NCE the war broke out the London rubber market has, if any- 

 thing, undergone a change for the better, so far as the planta- 

 tion article is concerned, At the end oi Jul) smoked sheet 

 was quoted at 2s. IV^d. [53.7 cents] per pound; at the time of 

 writing it stands at Is. 5'/id. [59.8 cents]. On the other hand, 

 fine hard Para has fallen from 2s. 10-,./. [70.4 cents] to 2s. <''.<</. 

 [61.8 cents]. Latterly a fairly substantial rise has taken place 

 m the price of plantation rubber, due mainly to the sinking of 

 the steamer "Troilus," with some l._'0() tons oi rubber aboard, 

 by the German cruiser "Emden," since destroyed. 



As regards the actual consumption of rubber, at the present 

 time one can only point to the firmness of prices ami infer that 

 the demand is keeping fully abreast of the supply. Ibis is the 

 more remarkable because, for the time being, the ( miinuntal de- 

 mand is almost a dead Utter. The Antwerp market was, of 

 course, suspended long since and the business transferred to 

 London. Importers have thus to depend almost entirely upon the 

 P.ritish ami American demand, and so far, this has been suf- 

 ficient to preserve the balance. Many English manufacturers 

 are now busy with Government contracts oi a size hitherto un- 

 heard of, and it is expected that this activity will be maintained 

 as long as the war lasts. Much trade also is being secured that 

 would, in the ordinary course of events, have gone to Germany 

 and Austro- 1 lungary ; and there seems no reason to doubt that 

 this trade will be retained here after the war. All this notwith- 

 standing, it is an open question whether the spinal requirements 

 of the armies in the field will counterbalance the falling off in 

 other directions. So far, market evidence gives answer in the 

 affirmative. 



POSSIBILITY OF SURPLUS. 



The question of providing against a surplus of plantation rub- 

 ber has been revived and the proposal is made that producers 

 should set aside a percentage of their crops to subsidise rubber 

 roadways and the development of new uses for the product in 

 general. The fear is certainly entertained in some quarters that 

 unless some such scheme be adopted a big surplus of rubber may 

 accumulate within the ensuing twelve months. 



The general situation in rubber was ably reviewed the other 

 day by Mr. A. A. Baumann in the course of a speech at the 

 annual meeting of the Rubber Share Trust & Finance Co., of 

 which be is chairman. He spoke in part as follows: 



"With regard to the prospects of the rubber industry on which 

 our revenue depends, we may consider it from two points of view 

 There is first of all. the ultimate prospects of prosperity and there 

 is the present, or immediate future, of the industry to be con- 

 sidered. Of the ultimate prospects of solid success for the rub- 

 ber industry I think no reasonable man can entertain a doubt. 

 What are the two essential factors of a commercial success? 

 They are the production of a basic commodity, and at such a cost 

 as will leave a substantial profit. Both these essential factors 

 are present in the rubber industry. Rubber, if not a basic com- 

 modity in the sense that sugar and wheat are, is, at all events, 

 as necessary to modern civilization as copper, and f think that 

 if you cannot call it a basic commodity today it certainly will 

 become one in the immediate future. 



"With regard to cost of production there can be no doubt that 

 the good rubber companies — those which are not over-capitalized 

 and which are well administered — will, when they are in full 

 bearing, reduce their all-in-costs to something like 9rf. per pound 

 at least. It would, therefore, seem a mere arithmetical sum to 

 infer that when our total area is in bearing our all-in-costs will 

 be reduced to somthing like 9d. per pound, and with that cost 

 I have no hesitation in saying that there is a very substantial 



;ii oi profit for the shareholders and for the owners of shares 



in rubber ci impanii s. 



'With regard to the immediate future of the industry, I am 

 bound to saj that the adversi fact n seem to predominate for 

 the moment ovei thi favorable ones, but i sec no reason why 

 we should be unduly pessimistic. The adversi factors are, of 

 course, found in the increase of production accompanied by a 

 diminution in certain quarters of consumption owing to the war. 

 The estimated output from the plantations for the current i n 

 is (o.iiih) ion ,,i rubber, \lthough I do not think that estimate 

 will be realized, the probability is the amount will not be very 

 far short of that figure. The estimated output of the plantai 

 for the year 1915 is 85,000 ions, which I do not believe for a 



moment will be realized foi various reasons. But if you put the 

 output oi the plantations for 1915 at 85,000 tons it means an in- 

 crease on the present production of 20,000 tons. 



(.1 i:\IAX REQUIREMENTS. 



"Now, Germany is in the habit, or has been for the last 

 years, of consuming some 20,000 tons of rubber, of which about 

 10.000 tons have come from the plantations in the East. Well, 

 1 need hardly point out to you that you cannot increase your 

 output by 20,000 tons and decrease your demand by 10,000 ton 

 without having an adverse effect upon the market for the com- 

 modity. Against this may be set off one factor, and that is the 

 increased consumption for war purposes by the Allies. There 

 is no doubt that this war is very largely a motor war, and we 

 can confidently anticipate a largelj increased demand for rub- 

 ber by Great Britain, France, Russia and the LTnited States. 

 But despite the difficulties of trading with Russia, there is al- 

 n:id\ noticeable an increased demand by that country for rub- 

 ber, which is not surprising, because the Russian soldiers are 



equipped with rubber I ts, as ours ought to be, and there i 



course, very great werr and tear on tires. I am told that our 

 manufacturers are working double shifts in making rubber 

 sheets for our soldiers. So much for the increased consumption 

 for war purposes. 



"Secondly, we may look for diminished supplies of rubber, 

 particularly from Brazil. Now, 1 have got some figures on that 

 point which are really rather remarkable a- showing the de- 

 crease of imports into this county during the nine months ended 

 September 30. I find that to September 30 there were imported 

 into Great Britain from all countries 4'',44_' tons of rubber as 

 compared with 52,268 tons of rubber in the same period in 1913. 

 The re-exports on the other hand from this country were larger 

 in 1914 than they were in 1913. The re-exports from this country 

 during the first nine months of the current year were 37.308 

 tons, as compared with 32,942 tons in 1913 ; leaving — and this is 

 the important point — a net quantity for home use of 12,134 tons, 

 as compared with 19,326 tons in the previous year, 1913 — which, 

 I think, is a very remarkable figure. Another consoling fact is 

 that our re-exports to France and the United States for the 

 current year arc in excess of those which we sent them in the 

 year 1913. In 1914 we re-exported to France 4.388 tons, as 

 against 3,541 tons in the previous year, and to the United Si 

 of America we re-exported 17,257 tons as compared with 12,797 

 tons in the year 1913; so that we have to set off against what 

 I call the unfavorable factors, the war and so on. the undoubt- 

 edly favorable fact that supplies from Brazil and from Africa 

 are diminishing and that our re-exports to the United States, 

 to France, and to Russia arc increasing. But still I think you 

 will find in the steady prices in the market that that fact is re- 

 flected" 



