London – Natural rubber (NR) prices in key futures and physical markets continued on a downward track in the two weeks to 18 June as market sentiment remained weak.
All Far East markets monitored by ERJ over the two-week period posted a decline, with the most-active rubber contract for September delivery in Shanghai seeing a weekly average drop of 4.2%.
RSS3 futures in Osaka tracked a negative trajectory with a 3.5% decline, while Kuala Lumpur latex saw the biggest fall at 8.5%.
The price declines are mainly linked to soft demand from the US and Europe, caused by supply chain and logistics disruptions, as well as a Covid-related slowdown in manufacturing in China and ASEAN states.
Slow rate of vaccination in India and other major NR-consuming countries in the ASEAN region also impacted demand, said a 14 June analysis by the Association of Natural Rubber Producing Countries (ANRPC).
Furthermore, the ANRPC noted that tapping had restarted in many producing countries with the end of the wintering season - so, global supply is expected to be “considerably higher from June onwards.”
Other potential factors affecting the short-term outlook of prices include stronger dollar and higher crude prices which are likely to negatively impact natural rubber markets, the association added.
Shanghai SHFE ru2109: Yuan13,365 (4 June) to Yuan12,795 down 4.2%
Osaka RSS3 nearby month: Yen243.2/kg to Yen234.5/kg– down 3.5%
Singapore SGX TSR20: $167.8/100kg to $160.8/100kg – down 4.1%
Kottayam RSS4: $232.80/100kg to $228.60/100kg – down 1.8%
Kuala Lumpur SMR20: $168.00/100kg to $162.15/100kg – down 3.4%
Kuala Lumpur Latex: $147.67/100kg to $135.04/100kg – down 8.5%