According to the data, the natural rubber commodity index on September 14 was 34.00, up 0.3 points compared with yesterday, 66.00% lower than 100.00 points (2011-09-01), and 24.63% higher than 27.28 points, the lowest point on April 2, 2020. (Note: period refers to 2011-09-01 to now)
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Figure 2: natural rubber mainstream price trend in the first half of September 2020
According to the data of natural rubber (standard 1) in East China monitored by the business agency, the mainstream price of domestic Baodao whole milk market was about 11792.5 yuan / ton on September 1, and 11551.25 yuan / ton on September 14, a half month decrease of 2.05%. Among them, the highest point in the first half of the month is 11792 yuan / ton on the first day, and the lowest point is about 11252.5 yuan / ton on the 10th day, and the maximum amplitude is also 4.58%. This half month is a very typical downward trend of shock.
Rubber production at home and abroad: in 2020, due to the special situation, epidemic situation, weather and other factors, the production of raw materials at home and abroad will be released slowly, so it is inevitable to reduce production. Under the situation that the demand for natural rubber is relatively good, the tight raw materials are the main reason for the price increase, while other factors such as weather also have certain impact on the price of natural rubber. Thai media reported on September 5 that the price of Thailand’s three-level cigarette adhesive (RSS3) exceeded 60 baht / kg in the previous week, the highest price in three years. At the press conference held by Zhu Lin, Deputy Prime Minister and Minister of Commerce of Thailand on September 9, Zhu Lin talked about the good export situation of Thailand’s cassava, rubber, corn and palm oil During the epidemic period, the global demand for rubber gloves increased, which led to the increase of latex sales. In addition, the geographical conditions of other producing countries, such as rainstorm weather, labor shortage, etc., as well as the internal factors in Thailand, especially the positive measures taken by the government, can help to increase the price of rubber. As the largest natural rubber producer in the world, Thailand’s rubber output in 2019 is 4.8 million tons, of which the rubber export volume is about 4 million tons. The change of raw rubber output and export directly affects the global natural rubber price. From the perspective of China’s domestic regions, the current rainy season has affected the tapping work and seriously affected the output; local traders said that the rubber warehouses in Kunming and Banna of Yunnan Province were basically empty, and the index rubber entered the market at the beginning of the month. The local rubber source tension was serious and sustained, and currently only the index glue was used to maintain the trade market.
Import and inventory: in terms of import, in August 2020, China imported 699000 tons of natural and synthetic rubber (including latex), with a year-on-year increase of 30%; from January to August, China imported 4.508 million tons of natural and synthetic rubber (including latex), an increase of 8.2% compared with 4.166 million tons in the same period of 2019. In terms of inventory, as of September 11, 2020, the natural rubber inventory of the Institute was 245850 tons, and warehouse receipts were 215210 tons, increasing 4018 tons and 1720 tons respectively; the inventory of No. 20 rubber was 38305 tons, and the warehouse receipt was 31490 tons, increasing by 1976 tons and 1613 tons respectively.
Downstream demand: first of all, as of September 11, 2020, the operating load of all steel tires of tire enterprises in Shandong was 74.52%, which was 2.71 percentage points higher than that of the same period last year. Second, the car sales volume increased moderately. China Automobile Industry Association released the production and sales situation of automobile industry in August 2020 on August 10. In August, China’s automobile production and sales reached 2.119 million and 2.186 million, respectively, with a 3.7% month on month decrease in output and a 3.5% increase in sales volume, with a year-on-year increase of 6.3% and 11.6% respectively. From January to August, China’s automobile production and sales were 14.432 million and 14.551 million, respectively, down 9.6% and 9.7% year-on-year. Compared with January July, the decline rates were 2.2% and 3.0% respectively. In August, China’s heavy truck market is expected to sell 128000 vehicles of various types, with a month on month decline of 8% and a year-on-year increase of 75%. On September 8, the passenger Federation announced the production and sales of passenger cars in August. The data showed that the production of narrow passenger cars in August was 1.644 million units, down 0.2% year-on-year; the retail sales volume was 1.703 million units, an increase of 8.9% year-on-year; the wholesale sales volume was 1.736 million units, with a year-on-year increase of 7.0%. The data shows that the prosperity of China’s automobile industry is growing year-on-year, while the month on month is declining. That is to say, the demand growth of the automobile industry is moderate and not completely in a boom state. Third, the prices of natural rubber, carbon black, steel cord and other tire raw materials rose several times in the third quarter, and the cost increased. Some tire enterprises raised their prices in line with the trend, which promoted the upward trend of tire prices.
Good for the industry: according to the data of business agency, the mainstream price of domestic natural rubber day fluctuated and decreased in the first half of September, which was mainly affected by the downward price of latex Market in Thailand and other countries and the current low macroeconomic situation. Recently, the governments of major foreign producing countries have made a lot of noise, hoping to stabilize rubber prices and promote rubber export.
Thailand: according to Thai media on September 13, in view of the recent domestic rubber price decline, the natural rubber administration of Thailand quickly held an emergency response meeting to calm the rubber farmers’ sentiment, saying that from the perspective of supply and demand, the future market of rubber prices is optimistic, and China’s demand for Thai rubber is still very strong. Officials of the Thailand Bureau of rubber administration believe that the price drop during the long holidays in September should be an intraday adjustment of prices, not a price crackdown. Because rubber prices have been rising continuously for a period of time, this adjustment may pave the way for the next round of rise. From the perspective of supply and demand and market price trend, it is still rising. In addition, luckchai kittipol, honorary president of the Thai Rubber Association, said he was more optimistic about the future of rubber, as the price of RSS3 rubber reached 60 baht per kilogram for the first time in more than a decade. In the past, Thailand’s rubber production was mainly concentrated in RSS grade rubber, which was used as a raw material for car tires, he said. The novel coronavirus pneumonia has driven the surge in demand for rubber gloves in recent years, driving rubber producers to transfer their production to latex for rubber gloves. Thailand’s latex production is expected to account for 30% of total rubber production this year, up from 20% last year. Luckchai kittipol said that domestic rubber consumption is expected to increase from 800000 tons in 2019 to 900000 tons as Thailand’s Ministry of transport has decided to use natural rubber to set up obstacles on roads nationwide. It is suggested that the government should further promote the consumption of natural rubber in order to maintain the domestic price and reduce the excessive dependence on export. At present, the proportion of rubber export in the total output is as high as 80%.
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Malaysia: China novel coronavirus pneumonia is reported in September 14th. The Dewan Negara said today that since the beginning of this year, the new crown pneumonia epidemic has affected the global market demand, especially the demand of China. The government will concentrate on stabilizing the price of rubber and increasing its added value. “Malaysia,” the report said. “The new price of the brand is affected by the outbreak of the new crown pneumonia in September 14th. II Datuk Seri Dr wee Jeck Seng, Deputy Minister of plantation industry and commodities, said the government was cooperating with the world’s major rubber producers, namely Thailand and Indonesia, to strengthen and stabilize rubber prices in the international market under the framework of the international tripartite rubber Council (ITRC). Wee said the government plans to increase the use of rubber in the country, boosting rubber prices in the medium to long term. These include the use of rubber in road construction and the production of new and value-added products based on rubber, including rubber gloves. He added that the government would also introduce the concept of rubber community farms to increase the supply of raw materials and generate additional income for small farmers through cash crops and animal husbandry. He said that the government planned to implement the latex corridor in the eastern region to obtain local latex products to support the development of latex products manufacturing industry, increase the income of small rubber farmers and increase the consumption of natural rubber in the tire industry.
EU: on September 3, the EU updated its list of key raw materials (the original version of CRM list 2020), and listed natural rubber as one of the biological materials as a key material. Natural rubber is an indispensable raw material for European tire and rubber industry, and also a key driving force for many industries (especially automobile industry). The tire industry alone absorbs about 76% of all natural rubber produced worldwide. Today, there is no alternative to natural rubber for all rubber trees currently in use. The list of key raw materials reconfirmed the priority of natural rubber in EU policy and the importance of ensuring a fair and sustainable supply of natural rubber to European industry. It also provides further support for ongoing industry research on alternative sources of natural rubber. This is the second time that the EU has listed natural rubber as an important raw material.
As for the future market, the business agency believes that the natural rubber price is currently in the best sales period of the year. However, due to the continuous rise of natural rubber before, the first half of this month is in the period of price adjustment. For the traditional consumption peak season of “gold nine silver ten”, the market still thinks that the future natural rubber is still in the rising market. In the case of tight raw materials in Southeast Asia and almost no new rubber in domestic production areas, especially in Banna, which can only be maintained by the index rubber, the natural rubber price will inevitably rise in the peak sales season and the demand is moderately good. However, due to the limited demand in the European and American markets, the domestic export volume is hindered, and the driving force of natural rubber’s big rise is weakened. In the future, the market remains cautious and multi perspective.
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