Rubber inventories in Qingdao founded lower, investigation

Rubber inventories of delivery warehouses in Qingdao are quite low and the warehouses at the bonded area is not busy at all, according to a latest investigation.

The year 2016 saw lower rubber inventories than 2015, market watchers said.

Futures delivery is quite slack at present, a completely different scenario from that of a year earlier. It is usually a busy period for rubber warehouses at Qingdao bonded area in November-December.

The rubber inventory at Qingdao bonded area dropped from 270,000 tons to 80,000 tons once in 2016, which then slowly recovered to 100,000 tons by December 2016.

Futures rubber price hit a low of 10,400 yuan/ton in mid 2016, after which it gradually recovered to 13,700 yuan/ton by early November and then accelerated the pace of going up. So far the futures rubber price has nearly doubled.

More rubber imports were delivered at port than at warehouses at Qingdao bonded area in 2016. For a certain period, the rubber price at port was higher than that of the bonded area.

The number of rubber traders has declined while their scales are much bigger. Currently, the traders are quite picky on rubber quality.

Participants in the rubber industry are generally optimistic about the rubber market for the first quarter of 2017. Investment institutions are even more optimistic, taking that the rubber market has entered a bull cycle.