Current Location: Home > More > Tireworld's Report > Page

Is natural rubber's ascending channel being blocked?

Statistics show that as of mid-Feb., the price of natural rubber has increased for five straight months.

Natural rubber had been in a bull market in 2016, with the price rising from 9,760 yuan/ton at the beginning of the year to 16,380 yuan/ton by yearend, up 67.83%.

In January, natural rubber price surged 26%.

Boosted by rubber price hike, tire price also increased. Domestic tire prices rose about 10% to 25% from Nov. 2016 to this Feb.

Nevertheless, many tire producers said even their had adjusted up the tire prices again and again, the growth was still smaller than that of raw material prices.

Lately in the natural rubber futures market, the price of natural rubber suddenly fell for 10 straight trading days, dropping from the highest 22,310 yuan/ton on Feb. 15, to the lowest 18,160 yuan/ton on Feb. 28.

Within the 10 trading days, the price of natural rubber dropped 4,150 yuan/ton, or 18.6%.

An industry analyst said with respect to the tendency in the up- and down-stream industrial chain, the deep adjustment should be a temporary phenomenon of speculation. In the long term, natural rubber is still in the ascending channel.

According to the International Rubber Study Group, the demand-supply gap of natural rubber across the world will be 1.1 million tons in 2017.

About 70% natural rubber are used for tire manufacturing and China so far is the world's largest natural rubber consumer.

The Association of Natural Rubber Producing Countries predicted that in 2017, China's import of natural rubber will reach 4.3 million tons, becoming the largest importer of the association.

Analysts reckoned that most of the natural rubber imports will be used to satisfy China's increasing demand for tire production.

Tireworld