Malaysian Rubber Board sees Covid uncertainties weighing on NR prices

Kuala Lumpur – Natural rubber (NR) prices are expected to remain steady in the near term amid worries on tight supply in major producing countries and the anticipated improvment in demand from China. 

Consumption is set to increase 2.6% year-on-year during August to October, driven by government stimulus and improving economic activities in the US, China and other major consuming countries, said the Malaysian Rubber Board (MRB) in its latest monthly NR markets update 4 Sept.

Prices in the local market are also expected to take cues from the performance of ringgit, crude oil prices and regional rubber futures markets.

Despite positive signals, MRB said uncertainties arising from the Covid-19 pandemic are likely to weigh on prices.

Market operators, the board added, will also monitor the development of a Covid-19 vaccine as well as the progress on US-China trade relation for further cues.

In August, the Kuala Lumpur rubber market trended upwards, with prices surging to highest level since February towards the end of the month.

The positive sentiment, said MRB, was contributed by firmer advices from regional rubber futures markets following optimism on China’s economy recovery and shortage of supply.