Rubber as Supply Enters Seasonal Decline

Index

On February 4th, the Qingdao STR20 natural rubber price index was $1970/ton, up $25/ton from the previous trading day.

Market Analysis

Futures Market:

Spot Market

Supply Side:

International: Northern Thailand has entered its off-season for rubber tapping, while Northeast Thailand is nearing the end of its tapping season, expected to cease in early February. Southern Thailand maintains peak production.

Currently, the overall Thai rubber-producing region is entering a seasonal supply reduction phase, making raw material procurement prices more likely to rise than fall. In Vietnam, the weather is favorable, and rubber tapping is nearing its end. The southern region is expected to continue tapping until before the Spring Festival, with local processing plants entering a stockpiling phase.

Domestic: Tapping has ceased in Yunnan and Hainan.

Demand: It is understood that most companies have confirmed their holiday shutdown dates. Currently, semi-steel radial tires are performing better than all-steel radial tires. Supported by export orders, some companies are delaying their shutdowns. For all-steel radial tires, some companies are already in the final stages of production, finishing around February 10th. Pre-holiday shipments are acceptable, and there is some pre-holiday stockpiling.

Futures and Spot Price Overview

Market Outlook

Today, the futures market maintained a slightly bullish and volatile pattern, with spot prices rising slightly in line with the futures market. Global supply is entering a seasonally decreasing phase, and overseas raw material prices are more likely to rise than fall, providing continued support for natural rubber costs.

Downstream purchasing intentions are relatively weak, with most purchases focused on replenishing only essential needs. With the Spring Festival approaching, traders' risk aversion is increasing, further dampening spot buying sentiment. The natural rubber market is expected to fluctuate within a range in the short term.

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