According to the monitoring of business agency, the natural rubber commodity index on August 24 was 35.97, down 0.11 points from yesterday, down 64.03% from the highest point of 100.00 points in the cycle (2011-09-01), and up 31.85% from the lowest point of 27.28 points on April 2, 2020. (Note: the period refers to September 1, 2011 to now)
Figure 2: natural rubber mainstream price trend from August 2022 to now
According to the monitoring of business agency, the market of domestic natural rubber (standard 1) in East China market has been continuously fluctuating slightly since the end of August. On the 11th, the mainstream price in East China market was about 12110 yuan / ton, and on the 24th, the main price was 12130 yuan / ton, a slight increase of 0.17%. Among them, the highest point of the price in the stage is 12192 yuan / ton on the 17th, and the lowest point is 12060 yuan / ton on the 19th. The maximum amplitude is only 1.08%. According to the data of business agency, the mainstream spot price of natural rubber in East China (Hainan Island) on July 24 was 12130 yuan / ton, down 0.30% from the previous trading day, down 7.76% year-on-year, only 1.85% higher than the lowest price of the year (11910 yuan / ton on July 22). Currently, it is still in the low valley of the annual market.
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Figure 3: trend chart of international mainstream crude oil prices in recent March of 2022
Macro: on August 23, international crude oil futures rose sharply. The settlement price of the main contract of WTI crude oil futures in the United States was US $93.74/barrel, up US $3.38 or 3.7%; The settlement price of the main contract of Brent crude oil futures was US $100.22/barrel, up US $3.74 or 3.9%. During the Iran nuclear negotiations, the expectation of Iranian oil returning to the international market and the risk of economic recession provide a basis for the change of OPEC + production control policy of oil producing countries. It is reported that the production reduction of OPEC + led by Saudi Arabia may be implemented simultaneously with the lifting of the Iranian oil embargo..
Figure 4: Weekly K-bar chart of natural rubber market in 2022
Industrial analysis: on the macro level, the international crude oil futures rose by nearly 4% on the 23rd, and China’s central bank cut interest rates, which boosted the investment market. On the supply side, at present, the domestic and foreign markets are in the seasonal peak season of glue production. It is reported that the export price of Thai glue is low, the output of domestic production areas is relatively normal, and the market fluctuates in a small range. At the import and export end, in July, China’s imports of natural rubber (including latex and mixed rubber) increased by more than 10% on a month on month basis, with an obvious increase in arrival. On the inventory side, as of last Friday (19), the rubber inventory of the exchange rose by nearly 500 tons. On the demand side, the inventory of finished tire products continued to be high, and the export and domestic sales volume decreased. In addition, under the influence of the current high temperature and extreme weather, the power supply was limited in many places. The operating rate of tire enterprises dropped significantly, and the overall operation of the industry was limited.
Recent hot spots: 1. According to the latest July report released by ANRPC, the global natural rubber production in July is expected to increase by 3.9% to 1.283 million tons, an increase of 15.5% over the previous month; The consumption of natural rubber is expected to increase by 8% to 1.266 million tons, an increase of 5.1% over the previous month. The report points out that despite concerns about China’s economic slowdown, the government has introduced a number of measures, including the central bank’s interest rate cut, to stimulate the economy to recover from the blockade and the deterioration of the real estate crisis. China’s car sales improved further in July, thanks to lower purchase taxes and incentives for electric vehicles.
2. According to the news from Thailand on August 23, the rubber price in Thailand continued to drop, especially the latex price has dropped to 43 baht per kilogram, which makes rubber farmers worry about whether they will face a rubber price crisis of 100 baht per kilogram, which will aggravate the pain of rubber farmers. Since the beginning of this month, the local rubber price has dropped by about 3 baht every day, resulting in the price of fresh latex being 40-43 baht per kilogram, while the price of broken rubber is 20 baht per kilogram, which is unacceptable to rubber farmers. Because it has greatly aggravated the suffering of rubber farmers, with the price of daily necessities and all kinds of food rising, the cost of living has risen, and many families’ income can not make ends meet.
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3. According to the latest data released by the National Bureau of statistics, in July 2022, China’s rubber tire output was 74.799 million, with a year-on-year increase of 2.5%. From January to July, the output of rubber tire casing decreased by 6.1% over the same period of the previous year to 49243.4 million pieces.
4. According to the latest data released by the National Bureau of statistics, in July 2022, China’s synthetic rubber output was 675000 tons, a year-on-year decrease of 1.9%. From January to July, the cumulative output of synthetic rubber was 4.542 million tons, a year-on-year decrease of 4.1%.
5. On August 11, China Association of automobile industry (hereinafter referred to as “China Association of automobile industry”) released the latest data. In July, the national automobile production and sales reached 2.455 million and 2.42 million respectively, with a month on month decrease of 1.8% and 3.3%, and a year-on-year increase of 31.5% and 29.7%. Purchase tax reduction and other promotion fee policies have an obvious effect on automobile consumption.
Future forecast: in the near future, the macro market has a certain driving effect. From the perspective of industry, the high temperature weather has an obvious and continuous effect on the start-up of enterprises. Although the automobile promotion policy has a promoting effect on the market, the future Tianjiao will still maintain a small range of fluctuations in the case of strong supply and weak demand and no obvious improvement in downstream demand.
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