The Supply and Demand Side is under Pressure, and the Rubber Spot Market is Fatigue(January 2, 2025)

一：The weather in overseas production areas has improved, and the cost side has entered a downward channel

Recently, the weather conditions in Thailand have been relatively improved, and the rubber tapping operations in various regions have returned to a relatively normal state, as far as the current situation is concerned, the northeast maintains a strong production, the weather in the south improves and the rubber cutting is gradually recovering. The supply increment is expected to be strong, and the purchase price of raw materials has continued to fall, and the cost side support has begun to show signs of weakening.

Vietnam's production areas are basically in the peak season, raw material output maintains seasonal incremental performance, boosted by the rise in the domestic and foreign spot markets in the first half of the month. The local rubber processing plants had a higher sentiment of purchasing raw materials, driving the purchase price of raw materials to rise. The precipitation of main production areas increased in the second half, so the rubber cutting activities were limited at the local areas, and it began to gradually transit to the production reduction period. The dry content of fresh rubber began to decline, and the processing plant was more enthusiastic about purchasing rubber, so the price of raw materials was easy to rise than fall. But the price of cup rubber slightly loosened. The main reason was that the production profit margin of the processing plant was damaged, so the factories purchased raw materials at a low price. And it is expected to enter a state of rubber cutting suspension at the end of next month.

二：Future market forecast

Up to now, on the supply side, the overseas weather has gradually returned to normal, southern Thailand has entered the peak production period, and the price of raw materials has shown a narrow downward trend, and the support on the cost side is relatively limited; The tire market is also in the off-season of demand, near the end of the year, the production of downstream product enterprises maintains a relatively stable state, and the raw material procurement sentiment remains relatively slow; In the near future, the supply and demand side of the rubber market is relatively limited, and it is expected that the short-term natural rubber market is expected to witness limited improvement, and the fatigue is difficult to change.