Natural rubber: Positive factors lack support
Index
On July 22nd, the Qingdao STR20 price index for natural rubber was $2210/ton, up $10/ton from the previous trading day.
Market Analysis
Futures Market:
Spot Market
Supply Side:
International: Weather conditions in parts of Thailand improved compared to the previous week, leading to an increase in new rubber production. Futures prices rose, Thai factories actively shipped rubber, increasing demand for restocking. Rubber farmers and secondary traders were reluctant to sell, pushing up raw material procurement prices. In Vietnam, raw material production is progressing normally, with overall latex production slightly increasing compared to the previous week. However, frequent afternoon thunderstorms and El Niño-driven daytime high temperatures resulted in slight divergence in raw material production.
Domestic: Rainfall persisted in Yunnan, but the impact on rubber tapping was limited, and raw material purchase prices stabilized. Weather conditions in Hainan were relatively favorable, with rubber tapping gradually resuming, and raw material production gradually returning to seasonal levels.
On the demand side: It is understood that most companies are currently maintaining their previous operating rates, with many operating at controlled capacity. A few semi-steel tire manufacturers have temporarily suspended operations, dragging down overall production. Overall, shipments are below expectations. Some semi-steel and all-steel tire manufacturers have offered promotional support to the market based on their inventory levels, but the actual effect has been limited. To increase shipments, some companies are gradually releasing small quantities of snow tires, with shipments starting earlier than in previous years.
Futures and Spot Prices Overview
Market Outlook
Today, the futures market saw a volatile rise, boosting market sentiment. Holders adjusted their offers slightly upwards. Weather conditions in major producing areas have improved, and upstream supply has entered a seasonal increase period, leaving room for further reductions in raw material procurement prices. This weakens cost support for rubber.
Downstream inquiries have improved slightly, but buyers are cautious with immediate needs, resulting in generally weak transaction volumes. In the short term, the natural rubber market lacks substantial positive drivers, and rubber prices are likely to continue to fluctuate within a range.
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