Natural Rubber Price Index Drops Amid (July 21)
Index
On July 21st, the Qingdao STR20 price index for natural rubber was $2200/ton, down $20/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 maintenance companies have returned to normal levels, tire production is steadily recovering, and the market shows regional differentiation. Some companies reported a slight rebound in semi-steel tire shipments in the south, but the overall increase in national demand is limited. Finished product inventories are generally high, and companies are mostly using promotions and price reductions to boost sales. The overall production and sales pattern of the industry has not improved significantly and will remain under pressure in the short term.
Futures and Spot Prices Overview
Market Forecast
Today, the futures market experienced wide fluctuations and instability. Spot offers saw a slight decline. 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.
Rubber cost support is weakening, and downstream factories are adopting a wait-and-see attitude, resulting in limited actual buying and weak market sentiment. In the short term, the natural rubber market is facing strong bearish sentiment, and rubber prices may continue to fluctuate within a range.
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