Natural rubber market rises before retreating.

Market Review: Following the holiday, downstream industries have resumed operations and production, improving the production rhythm and contributing to inventory depletion, which has boosted rubber prices to some extent. On the supply side, improved weather in northeastern Thailand has led to strong expectations of concentrated production increases in producing areas, causing raw material prices to enter a downward trend.

Coupled with the uncertainty surrounding post-holiday Sino-US tariffs, bearish sentiment in the natural rubber market has intensified, halting the upward trend in rubber prices and entering a downward trend, with the overall center of gravity shifting downward month-on-month.

Supply Side: Rainfall has eased, leading to an increase in raw material output. International production areas: Rainfall has eased in northeastern and northern Thailand, while irregular rainfall has disrupted southern Thailand.

While prices for raw materials may continue to diverge, they have generally remained down compared to pre-holiday levels. Improved weather in Vietnamese producing areas has led to a return to normal rubber supply. Supported by factory domestic purchasing demand, rubber price fluctuations are limited.

Domestic production areas: Rainfall disturbances persist in Yunnan, but the overall impact is minimal. Processing plants, constrained by high processing costs and inverted profits, have seen a slight decrease in raw material purchase prices. Rainy weather disruptions persist in Hainan, slowing supply growth. However, under pressure from persistent processing profit losses, local processing plants are generally reluctant to purchase raw materials, leading to a decline in rubber purchase prices.

Overall, weather conditions in major producing areas around the world are expected to improve, mitigating the impact on rubber tapping. Raw material output is beginning to increase, leading to a slight weakening of raw material prices, and supporting a decline in costs.

Downstream demand: Demand remains strong as maintenance companies resume work and production.

For semi-steel tires, all-season tire market activity declined compared to last week, with reduced channel restocking and flat sales at retail stores.

Transaction prices remained largely stable. Demand for snow tires is rising. Cooler temperatures in Northeast China and the arrival of the first snow in Heilongjiang are driving increased demand for snow tires, increased sales at retail stores, and stronger expectations of channel restocking.

For all-steel tires, replacement market demand is sluggish. While some tire manufacturers have implemented price increases, market sentiment remains subdued. To maintain channel customer stability, market trading continues to focus on prior prices.

[Market Forecast] Weather in overseas production areas continues to improve, with expectations for increased production expected to be strong, potentially leading to some downward price movement. Post-holiday, overall downstream market performance has not seen a significant improvement.

To control inventory buildup, some companies are still implementing flexible production controls, leading to generally stable plant operations in the short term. With no significant fundamental drivers driving rubber prices, prices may fluctuate and weaken.

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