Natural rubber exports in the first three months of the year only reached 148,000 tonnes, down 9.8 per cent compared to the same period in 2006, according to the VRA.

Exports were valued at US$254 million, down 5.6 per cent year-on-year.

Tran Thi Thuy Hoa, VRA general secretary, attributes the reduced output to unusual weather patterns. "This year, [the seasonal] drought came early and lasted longer than in previous years," says Hoa.

The dry season has passed, but already taken its toll on harvests.

The association predicts exports will continue to fall this month, spurred instead by price fluctuations on the global market.

"Companies know that the price of export rubber is increasing while volumes are falling. They may try to cut exports now to wait for even higher prices later," says Hoa.

In the first quarter, the average price of rubber stood at $1,715 a tonne, up 5 per cent year-on-year. The VRA expects prices to rise even further this month.

In February, the price of rubber shipped to China increased by about $129 a tonne compared to January, while product destined for Korea and Japan increased by $254 and $229 respectively.

Rubber prices in March, however, stabilised.

In the first month of the year, China imported 41,000 tonnes of Vietnamese natural rubber, up 2,000 tonnes year-on-year, representing 61.3 per cent of the country’s total rubber exports.

Currently, Viet Nam is the world’s fourth largest rubber exporter, behind Thailand, Indonesia and Malaysia. "It is difficult for us to move up the list because the other three countries’ exports are so big, about several millions tonnes each year," says Hoa.

According to the Finance Research Institute, global rubber output this year will increase 3 per cent and 4.5 per cent in 2008. Thailand’s output is estimated to grow 2.1 per cent in 2007 and 3.8 per cent next year.