The new crown pneumonia epidemic has caused a crisis in the global economy and weak downstream demand for rubber. The Association of Natural Rubber Producing Countries has again lowered its global natural rubber production and consumption expectations for 2020. It is understood that the Kuala Lumpur-based ANPRC's estimate of natural rubber production in May decreased, compared with April's estimated value of 303,000 tons; the world's natural rubber production is expected to decline by 4.7% to 13.103 million tons by 2020.
Beginning at the end of April 2020, the economic activities of various countries around the world have gradually developed, and natural rubber prices have started to pick up. ANRPC Secretary-General RB Premadasa said: "Despite the slow pace and the impact of a series of risk factors, the recovery may continue." Four factors will Promote the rise in natural rubber prices. ①Several countries are gradually being blocked; ②The research and development of new coronary pneumonia vaccines are becoming more and more optimistic; ③Crude oil prices have boosted the price of rubber; ④World natural rubber production has dropped significantly in the first and second quarters of 2020.
Premadasa believes: "The geopolitics centered on the US national security legislation on Hong Kong and China has influenced market sentiment in May," in the latest ANRPC announcement, world natural rubber consumption is expected to decline by 6% in 2020 to 12.904 million Ton. India has reduced its estimate of natural resource consumption in 2020 from 1.065 million tons in April 2020 to 900,000 tons, while China has slightly increased its estimated consumption in 2020 from 5.21 million tons to 5.24 million tons.
Tripura is India's second largest rubber producer after Kerala, producing more than 68,000 metric tons (MT) of rubber on 85,000 acres throughout the year. However, in the blockade implemented as a preventive measure against coronavirus outbreaks, 90% of all rubber production exported to other parts of the country has ceased, and Tripura rubber growers face huge losses. Other rubber producing regions in the world also suffer from varying degrees of impact.
Based on the current situation, the global natural rubber production reduction has basically become inevitable; the automotive market is the main end demand industry for natural rubber, and the Asia-Pacific region is the main consumer market for natural rubber. After the epidemic, the development of the automotive industry and the resumption of downstream enterprises in the Asia-Pacific region will directly affect Natural rubber production and consumption later. Premadasa pointed out: The occurrence of the epidemic has plunged the world rubber industry into a major crisis. But at the same time, the growth of some rubber protective products market has created additional demand for natural rubber. This helps to offset the impact of the decline in demand in some car and tire markets.