[ C L I E N T   N A M E ]

Presentation2

Global Supply and Demand of Natural Rubber

Presented by Paul Sumade Lee

Chairman, International Rubber Association

28 May 2015, Shanghai, China

Agenda

SECTION 1

SECTION 2

SECTION 3

SECTION 4

Global Supply and Demand

Rubber Industry Value Chain

Drivers of Supply and Demand Forces

Conclusion

SECTION 1

Global Supply and Demand

Major Players in the NR Market

China 38%

USA 8%Europe 9%

India 9%

Japan 6%

Thailand 5%

Others 26%Indonesia 27%

Thailand 35%China 7%

Malaysia 6%

Vietnam 8%

India 6%

Others 12%

Consumers Producers

Demand and Supply 2014

Thailand Indonesia Vietnam China India Malaysia0

5001,0001,5002,0002,5003,0003,5004,0004,500

-6.0%-4.0%-2.0%0.0%2.0%4.0%6.0%8.0%10.0%12.0%

4,170

3,101

1,097 946 811 667

0.0% 0.0%0.6%

8.6%

10.8%

-4.9%

NR Production (tons) %growth from 2014

China Europe India USA Japan Thailand0

5001,0001,5002,0002,5003,0003,5004,0004,5005,000

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

4,669

1,148 1,069 988674 567

3.9%

1.6%

5.4%

4.3%

-0.6%

4.0%

NR consumption (tons) %growth from 2014

Supply

Demand

Natural Rubber Balance • Shrinking of supply surplus

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015f0

2

4

6

8

10

12

14

7.9 8.7 9.2 9.7 10.1 10.2

9.3 10.8 11.0 11.0 11.4 11.9 12.3

8.1 8.8 9.0

9.9 10.1 10.1 9.7 10.4 11.2 11.6 12.2 11.8 12.4

Unit : million tons

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015f

(600)(400)(200)

0 200 400 600 800

1,000

152 100

(194)

269

(81) (89)

434

(370)

219

568

831

(45)77

Unit : million tons

Demand Supply Supply Surplus

Forecast of Continuous Excess Supply

2011 2012 2013 2014 2015f 2016f 2017f 2018f 2019f 2020f 2021f 2022f 2023f

(100)

0

100

200

300

400

500

600

700

800

900

219

568

831

-45

77 51

85 73 71 95 86 71 75

Unit : 000’ tons

Reduction in New Planting Areas

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015f 2016f0

100

200

300

400

500

600

8,500

9,000

9,500

10,000

10,500

11,000

11,500

12,000

12,500

New planting (LHS) Replanting (LHS) Total area (RHS)

Unit : million tons

合计新的种植 补植

Rubber Plantations by Country

Indo

nesia

Thaila

nd

China

Mala

ysia

Vietna

mIn

dia

Cambo

dia

Sri La

nka

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

3,016 2,755

720 650 575 473

115 115

640

62

428 429 405

341

247 25

3,656

2,817

1,148 1,079 980814

362140

Immature area (000' Hectares) Tapped area (000' Hectares) Yield per hectare (Kg.)

Yield

Rubber in Qingdao Stock

15 May 2015青岛库存：天然橡胶 NR – 155,800复合 CPD – 27,000合成胶 SR – 12,000

SECTION 2

Rubber Industry Value Chain

Rubber Value Chain

SECTION 3

Drivers of Supply and Demand Forces

Drivers of Natural Rubber Prices

Natural Rubber Price

Key Supply Drivers:

-Persistent low prices have reduced supply -Unseasonal weather patterns

Uncertainties:

-Continued intervention by the Thai Government? -Continued appreciation of US dollar?

-Funds and rubber traders activities

Key Demand Drivers:

- Steady global growth -Quantitative easing in Europe coupled with the resurgent US economy. -Weak Euro increases EU export competitiveness.

CRB Index

Copper

Iron Ore

Nymex

US Dollar Index

SICOM TSR20

SECTION 4

Conclusion

结论

Is rubber price of $1,500 a ton too high or too low?

TSR 20 Conclusion

Thanks ！ 谢谢！