August 4 Natural Rubber Price & Outlook
Index
On August 4th, the STR20 price index of natural rubber in the Qingdao market was $1,750/ton, up $10/ton from the previous trading day.
Market Analysis
Futures Market: Spot Market Supply: Internationally: Weather conditions improved across most of Thailand, leading to a slow increase in supply and dragging down raw material prices. Rain continued to disrupt parts of Vietnam's production areas, but overall output showed steady seasonal growth. Vietnamese rubber processing plants saw improved shipments of finished products, boosting their raw material procurement activity and supporting relatively firm raw material prices.
Domestic: Weather improved in parts of Yunnan, leading to a slight increase in rubber release compared to the previous week. Processing plants continued to rush to harvest raw materials, keeping raw material prices firm. Improved weather in Hainan's production areas led to a seasonal increase in overall supply. Processing plants saw limited profit margins and reduced willingness to restock high-priced raw materials, suppressing the purchase price of raw rubber.
On the demand side: It is understood that the resumption of operations at companies undergoing maintenance will boost the overall operating rate to some extent. However, some companies have scheduled maintenance at the beginning of the month, resulting in differentiated production schedules. The overall operating rate is primarily subject to minor adjustments, and the overall potential for improvement is limited.
Futures and Spot Prices Overview
Market Forecast
Today, the main rubber futures contract saw volatile trading, with spot quotes moving within a narrow range. Production volumes continued to increase across producing areas, while raw material prices declined, weakening cost support.
Weak end-user demand and lower operating rates are providing limited support for rubber prices. Furthermore, as macroeconomic sentiment shifts to a bearish trend, bearish market sentiment is intensifying. We expect rubber prices to remain weak and consolidate in the short term.
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