The rubber sector saw gains across the board in August, with synthetic rubber rising more sharply than natural rubber. Natural rubber prices were bolstered by strong cost support, as tapping operations in Southeast Asia were hindered by the rainy season. Meanwhile, international crude oil prices fluctuated at high levels due to ongoing conflict risks in the Middle East; this drove up the costs of synthetic rubber feedstocks (such as butadiene) and chemical products (like carbon black), providing strong cost support for synthetic rubber. However, the tire industry was in its traditional off-season, which limited the extent of the rubber sector's upward movement.
Supply Side: Natural rubber entered the peak tapping season in Southeast Asia, though rainfall disrupted operations, keeping the price of Thai cup lump at a high of 70 THB/kg. Total natural rubber inventory at Qingdao Port stood at 631,500 tons, a month-on-month decrease of 1.65%. On the synthetic rubber side, upstream butadiene prices rose, driven by crude oil; domestic operating rates were 74–75% for polybutadiene rubber (BR) and 68–71% for styrene-butadiene rubber (SBR), with some units undergoing maintenance and inventory pressure remaining low. Carbon black prices were raised due to higher chemical feedstock costs, thereby increasing the overall production cost of tires.
Demand Side: The tire industry was in its traditional off-season; operating rates for sampled all-steel tires and semi-steel tires stood at 64.15% and 65.81%, respectively, with the semi-steel rate down 6.06% year-on-year. Finished tire inventories were relatively high, leading enterprises to prioritize purchasing based on immediate needs; there was little willingness for large-scale restocking, and significant resistance to high-priced raw materials. Demand for non-tire rubber products remained stable but was insufficient to offset the weakness in the tire sector. Tire manufacturers adjusted the blending ratios of natural and synthetic rubber based on price differentials to mitigate cost pressures.
Market Outlook: September marks the start of the tire stocking window, suggesting potential marginal improvement in demand. For natural rubber, the focus remains on rainfall in Southeast Asia; weather disruptions would continue to support prices, whereas a surge in tapping volume could trigger a pullback. Synthetic rubber prices are heavily dependent on butadiene and crude oil costs; if Middle East conflict risks persist, synthetic rubber prices may continue to rise, driven by cost support. Key factors to watch in the coming period include September tire operating rates, crude oil prices, weather conditions in production regions, and macroeconomic sentiment.
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