DRAFT Stock levels to keep lid on NR prices

Natural rubber (NR) prices are likely to remain under pressure throughout 2019, despite trends that led consumption to outstrip supply of the commodity last year.

Current low pricing levels reflect “excess supply” which is pushing up global NR stocks for a third consecutive year, according to a 12 March quarterly report in The Rubber Economist.

“The picture is not expected to change much over the next few years and surplus may continue with stocks rising to reach 4.9 million tonnes by 2021,” said the report edited by Dr Prachaya Jumpasut.

This will likely impact NR prices, as the relative stock/consumption ratio has not risen to as high as in the past, the report added.

Weather conditions, currency movements and speculation in the futures market can have temporary impact on prices, the analysis went on to note.

However, it concluded, global economic problems, the growing importance of smaller and lower-cost producing countries and the hangover of global stocks are likely to keep prices on “a gradually declining trend.”

ERJ Silver and Gold level subscribers can access the full report via the report link. If you are not yet a subscriber, please visit our subscription section to access to ERJ’s industry-leading information products and services.