The price of rubber on the world market increased quite strongly in the past month. The reference rubber contract on the Osaka floor is 12% higher than a month ago, while the oil price increased only about 2% at the same time.
On August 14, 2020, natural rubber contracts in January 2021 on Osaka floor cost 175 JPY (1.64 USD) / kg, up 12% compared to a month earlier. Compared to the time of the lowest price of this year (March 30, 2020, when the price was at a 4-year low), the price of this item has increased by more than 20%.
The reference term rubber on the Shanghai floor has increased by 22% since the end of March 2020.
In the world's leading rubber producing countries, raw rubber prices have simultaneously increased in recent months due to the expectation of economic stimulus programs in the world's leading rubber consuming countries such as the US. , China ... and the positive data from major economies in the world showed a recovery after a period of prolonged weakness because of Covid-19, especially the Chinese economy.
The main motivation for rubber prices to rise sharply in recent years is due to demand from China - the number 1 rubber consuming country in the world, and the root cause comes from economic signs of recovery after the pandemic. Covid-19 was earlier than the Western economies, especially from the automotive sector.
Sales of new cars in China - the largest auto market in the world - in July 2020, an increase of 16.4% compared to the same month in 2019, reaching 2.11 million units, the fourth consecutive month of increase.
It is forecasted that in the next 3 months, natural rubber prices will continue to increase due to the strong demand.
According to ANRPC, the natural rubber demand for the whole 2020 will reach 12.75 million tons, up from 12.67 million tons in the previous forecast and also up 7.3% year on year.
ANRPC said that the global natural rubber production in 2020 will only reach 13,195 million tons, down 4.5% compared to 2019. This figure is almost similar to the previous forecast (June 2020 forecasted by ANRPC is the output will be at 13,199 million tons). Increased demand while decreasing output will continue to push up natural rubber prices.