According to the data from the Commodity Market Analysis System of SunSirs, the natural rubber market in China experienced a volatile decline in the second half of July, with a slight rebound at the end of the month, but the rebound was not significant. On July 16th, the domestic Baodao full latex spot in the East China market was mainly priced at 12,150 RMB/ton, while on July 28th, it was mainly priced at around 11,960 RMB/ton, a half month decline of 1.56%; Among them, the highest price in half a month was 11,850 RMB/ton on July 16th, with a maximum amplitude of 2.47% during the period.
On the supply side, data shows a clear trend in global production growth: ANRPC's latest June 2023 report predicts that global natural rubber production is expected to increase by 1.9% to 1.119 million tons in June, a significant increase of 11.5% compared to the previous month. And the latest data shows that in the first half of the year, China's imports of natural and synthetic rubber (including latex) increased by 18% year-on-year, leading to a continuous increase in inventory at major domestic ports. Natural rubber inventory in the Qingdao region continues to be high, with the inbound rate exceeding the outbound rate. The issue of high storage of rubber has not been substantially resolved, and supply pressure remains high.
At the downstream end, the Market data released by the European Tire and Rubber Manufacturers Association (ETRMA) in the middle of July showed that the sales volume of replacement tires in Europe in the second quarter of 2023 fell 13.2% year-on-year to 54.85 million. All segmented markets have experienced negative changes, and the global economic downturn and rising costs caused by inflation have suppressed demand. And according to data, the retail sales of narrow passenger cars are expected to be 1.73 million units in July, a decrease of 8.6% month on month and 4.8% year on year. Among them, the retail sales of new energy vehicles were approximately 620,000, a decrease of 6.8% month on month and a year-on-year increase of 27.5%, with a penetration rate of approximately 35.8%. Downstream support is significantly insufficient, with weak demand for natural rubber.
Regarding the future market, there have been two typhoons recently, and there are reports that new rubber production is limited in some regions of Southeast Asia, Vietnam, and China's domestic rubber areas. It is expected that if there is funding to drive the market in the short term, the market may have an upward impulse. Overall, in August, there was a severe accumulation of domestic spot rubber inventory and it was still the off-season for car sales. Against the backdrop of poor downstream demand, natural rubber may face significant upward pressure.
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