Rubber Daily Report: Bulls and Bears Coexis

Index

On May 26th, the Qingdao STR20 price index for natural rubber was $2260/ton, down $10/ton from the previous trading day.

Market Analysis

Futures Market:

Spot Market

Supply Side:

International: Thailand has entered its rainy season, with localized rainfall temporarily affecting rubber tapping. However, the trend of increasing raw material supply continues, leading to increased pressure on prices from factories.

Vietnam's producing areas have experienced periods of rainfall, but these short-term showers have not significantly disrupted tapping operations. Vietnam is currently in the full-scale tapping phase, with new rubber production further increasing month-on-month. However, the market generally expects a concentrated surge in raw material supply around June.

Domestic: Weather conditions in Yunnan's producing areas are relatively favorable, with raw material production seasonally increasing, and raw material purchase prices showing a slight downward trend.

Weather in Hainan's producing areas is relatively good, with tapping gradually commencing. The seasonal increase in raw material production is proceeding normally, and some processing plants are maintaining a premium purchase price to ensure order fulfillment and production needs.

Demand Side:

It is understood that tire manufacturers' facilities are operating smoothly overall, although some manufacturers are still experiencing production restrictions, resulting in little change in total industry output. Semi-steel tires of certain specifications remain in short supply, while all-steel tire inventory is relatively abundant. Domestic market shipments are slow, and the shortage of supply has a weak impact on overall shipments.

Futures and Spot Prices Overview

Market Forecast

Today, futures prices fluctuated within a range, and natural rubber spot prices adjusted narrowly. Market inquiries were moderate. Overseas production areas are currently in the early stages of tapping, and factories are still eager to purchase raw materials.

However, domestic production areas are expected to see a significant increase in supply, leaving room for further declines in raw material purchases, which will drag down rubber prices to some extent. Downstream buyers are still maintaining just-in-time stockpiling. In the short term, the natural rubber market is characterized by both bullish and bearish factors, with rubber prices expected to remain range-bound.

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