Chinese firm eyes rubber trading platform in SEA

QINGDAO, China – Chinese government owned-entity Rubber Valley Co. Ltd. is set to launch a trading platform for natural rubber that will be open to firms and investors in China as well as in Southeast Asia to provide an efficient channel for transactions between suppliers and buyers.

John Ren, marketing director of Rubber Valley’s subsidiary, Qingdao Rubber Valley Supply Chain Co. Ltd. told visiting journalists the firm has worked with China’s biggest spot trading exchange, the Tianjin Bohai Commodity Exchange, to put up a third party natural rubber trading platform.

The Rubber Valley Natural Rubber Exchange, will initially be open only to enterprises registered in China starting July 8.

“In the fourth quarter of this year, all companies from your country can participate in this exchange without any obstacles,” Ren said.

He said the firm has decided to create a trading platform for natural rubber to provide buyers and sellers an efficient and transparent channel where they can meet and directly set the price of the commodity.

He said they want to avoid a situation where market prices will be too high such that firms requiring natural rubber such as tire factories will not be able to purchase the commodity or where prices will be so low that rubber producers would not want to sell.

Through the platform, he said the buyers and sellers will be able to participate in the pricing of the commodity.

The Chinese government has also decided to set-up the trading platform to be able to find source of supply of rubber to meet its requirements.

China, Ren noted, is the biggest buyer of rubber in the world, accounting for 33 percent of global demand per year.

All transactions through the platform will be settled in Renminbi (RMB).