Natural rubber: Prices expected to rise (July 8)
Index
On July 8th, the Qingdao STR20 price index for natural rubber was $2210/ton, down $15/ton from the previous trading day.
Market Analysis
Futures Market:
Spot Market
Supply Side:
International: Raw material supply in Thai producing areas is entering a seasonal, month-on-month increase phase. Processing plants are continuously lowering raw material purchase prices, resulting in a wide decline in raw material prices.
In Vietnam, increased rainfall has led to a relatively stable supply of raw materials, and the overall market is in a seasonal production release cycle. Affected by the increased supply of raw materials and a weakening futures market, processing plants in the producing areas are adopting a cautious purchasing attitude.
Domestic: Yunnan producing areas have been affected by rainfall in the short term, but the overall supply pace has not been affected, and raw material prices in the region are generally stable. In Hainan, improved weather conditions have led to the resumption of rubber tapping in most areas, and the supply of new rubber has recovered. Local processing plants have more raw materials available for purchase, and raw material purchase prices have fluctuated within a limited range.
On the demand side: It is understood that some maintenance-related enterprises have restarted their equipment, providing some boost to the tire supply. However, some enterprises still have long maintenance periods, dragging down the overall supply increase. Overall, shipments were slow at the beginning of the month, with most enterprises continuing their previous policies. High-priced raw material inventory pressures have resulted in insufficient overall profits, and enterprises still face pressure to release policy restrictions.
Futures and Spot Prices Overview
Market Forecast
Today, futures prices fluctuated within a range, while spot offers remained largely unchanged. Holders showed moderate willingness to offer. On the supply side, domestic and international production areas are currently in their seasonal production increase period. Although there may be short-term disruptions from rainfall, the overall upward trend remains strong, while cost support is relatively weak. Furthermore, the seasonal weakness of downstream tire enterprises in China is unlikely to change, resulting in insufficient upward momentum for rubber prices. In the short term, prices are expected to remain range-bound.
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