STR20 Price Decline: May 26 Update

Analysis of natural rubber market prices on May 26

Index

On May 26, the STR20 price index of natural rubber in Qingdao market was 1,770 USD/ton, down 10 USD/ton from the previous trading day.

Market analysis

Futures market

Spot market

Supply:

Foreign: At present, the output of new rubber in the Thai production area is small at the beginning of the harvest, and the price of rubber continues to rise due to frequent rain disturbances in recent days.

Domestic: The rainy weather in Yunnan production area has continued, which has affected the rubber tapping process and delayed the concentrated increase of raw materials, but the overall raw material output has maintained an increasing trend. The weather conditions in Hainan production area have improved, and some rubber forests on the western line have just started to be harvested. The rubber tapping work on the island has been promoted, and the output of raw materials has shown a month-on-month increase.

Demand: It is understood that the production schedule of most tire companies has gradually entered a stable state recently, and the overall situation has improved slightly compared with the previous cycle. In order to control the growth of inventory, some companies have slightly reduced their production schedules to limit the increase in the overall operating rate. The overall shipment performance of enterprises is average, and the inventory pressure remains unchanged. Under the pressure of production and sales, a few enterprises have maintenance plans at the end of the month, which may drag down the overall start-up.

List of futures and spot prices

Market forecast

Today, the closing price of the main rubber contract still maintains a downward trend, and the futures market fluctuates. After the rainy season in many upstream production areas, the supply volume is expected to continue to rise. The supply pressure on the raw material side is fully revealed, and the cost side is expected to drag the rubber price relatively.

The support for rubber prices is limited without obvious improvement in terminal demand, and the macro bearish sentiment is dominant. It is expected that the rubber price will still have a risk of falling in the short term.

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