The Price Of Raw Materials Soared To Support The Upward Price Of Natural Rubber

- Oct 26, 2020-

On October 23, 2020, the main rubber contract opened at 15,000 yuan/ton, and the closing price yesterday was 14,810 yuan/ton; the opening price of rubber 2011 was 13,745 yuan/ton, and the closing price yesterday was 13,705 yuan/ton; the opening price of rubber 2101 was 15,000 yuan today /Ton, yesterday's closing price was 14810/ton; rubber 2103 today's opening price was 14865 yuan/ton, yesterday's closing price was 14705 yuan/ton; rubber 2104 today's opening price was 14820 yuan/ton, and yesterday's closing price was 14685 yuan/ton.

The rubber-producing regions in Southeast Asia are both affected by the severe weather and the new crown pneumonia epidemic: in the early stage, affected by the new crown epidemic, the consumer demand for rubber dropped sharply, and the price of glue was also at a low level. April was in the cutting season, but there was mild drought. And the low price has delayed rubber tapping, and overall rubber production has declined. From July to August, the rubber tapping process was affected by the excessive rainfall, and the rubber tapping was blocked, and the raw material prices began to become very firm.

In September, the tropical storm "Hongxia" affected 27 provinces in Thailand. Among them, heavy rains were observed in the main producing areas such as Rayong, Surat Thani and Nakhon Si Thammarat. The accumulated rainfall in the three months increased by +53.0% year-on-year. Domestic typhoon No. 16 made landfall from the eastern part of Hainan Island to the south of Guangxi on October 13th, bringing ninth-magnitude winds and heavy rainfall; the No. 17 typhoon of this year may usher on the 20th, and it will approach the southeastern part of Hainan Island on the 24th. The heavy rainfall brought by the typhoon will affect the tapping work and the production process will be affected.

Due to the epidemic, the demand for gloves has skyrocketed, and overseas latex production is highly profitable, resulting in low output and strong prices of high-end rubber such as tobacco sheet rubber. Overseas production cuts have triggered further production cut expectations. The recent improvement in exports is a possible reason for the rise. The price of glue and thick milk has risen sharply, forming a strong support and bullishness for all latex to boost the price of natural rubber in the short term or maintain its upward trend; but if there is no strong factor support in the later market, there is still a possibility of falling back to 13,000 yuan/ton .