Data monitoring shows that China’s natural rubber market continued to fluctuate in the second half of November (16-30), and the increase range has expanded near the weekend. The price of China’s domestic standard 1 spot rubber was quoted at 14240 yuan / ton in East China market on the 16th and 13890 yuan / ton on the 30th, down 2.46%; The highest price this week is 14360 yuan / ton, the lowest point is 13890 yuan / ton at the weekend, and the maximum amplitude is the decline of 3.27% in that week.
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The factors affecting the market in the second half of the month are:
1. Macro: since November, crude oil prices have fallen sharply. WTI crude oil fell by 18.45% and Brent crude oil fell by 14.49%; The crude oil analyst of business society believes that in the short term, the impact of the new virus will continue to ferment, the epidemic in Europe will become more and more intense, and the oil price will be in a short atmosphere. However, the oversold on Friday also basically digested the bad expectations, and it is unlikely that the oil price will continue to fall sharply. At present, the market focus is mainly on the OPEC + meeting to be held next week. Overall, oil prices may fluctuate weakly in the near future, and the possibility of continued bottoming cannot be ruled out.
2. Supply side: production area: Southeast Asia is affected by bad weather and frequent rainfall, which affects the local rubber cutting and raw rubber supply. For example, Thai media reported on November 26 that Thailand continues to issue flood warning in the South; As the northeast monsoon is strong and water vapor continues to be brought from the Gulf of Thailand, there is a fear of heavy rainfall in southern Thailand until 30 days ago. Eight governments such as Chunpeng must pay attention to the flood caused by accumulated precipitation; Secondly, a new type of deciduous disease broke out in rubber trees in Thailand. According to Thai media reports on November 29, jessada, director of Thai Rubber Research Institute, revealed that a new type of deciduous disease broke out in rubber trees in jianzhuwen and Dalat provinces in eastern Thailand, with a sick rubber forest area of more than 100 Lai. China’s rubber production areas in Yunnan began to stop cutting one after another, and Hainan stopped cutting at the end of the year. Affected by the cold wave weather, the cutting stop date may come ahead of schedule. In general, the significant reduction of domestic and foreign supply has significantly supported the rubber price. Output data: the October report recently released by ANRPC predicts that the global natural rubber output will increase by 1.8% year-on-year to 13.836 million tons in 2021. Among them, Thailand decreased by 3.9%, Indonesia increased by 2.8%, China increased by 22.9%, India increased by 15.3%, Vietnam slightly increased by 0.3% and Malaysia increased by 3%. In October, the global output of natural rubber is expected to drop by 0.6% to 1331000 tons. Among them, Thailand decreased by 2.4%, Indonesia increased by 4.7%, Vietnam decreased by 1.7% and Malaysia increased by 20.1%.
3. Downstream: operating rate data: the data show that the operating load of all steel tires of tire enterprises in Shandong last week was 66.00%, an increase of 0.37 percentage points over last week, a decrease of 9.35 percentage points over the same period last year and 2.06 percentage points over the same period in 2019. The operating load of semi steel tire was 62.25%, an increase of 1.07 percentage points over last week, a decrease of 9.04 percentage points over the same period last year and 6.56 percentage points over the same period in 2019. Consumption data: according to the October report recently released by ANRPC, the global consumption of natural rubber is expected to increase by 8.3% year-on-year to 14.028 million tons in 2021. Among them, China increased by 5.4%, India increased by 14.4%, Thailand decreased by 4.6% and Malaysia decreased by 2.4%. In October, the global consumption of natural rubber is expected to decline by 3.7% to 1141000 tons. Among them, China decreased by 9.3%, India by 23.1%, Thailand by 9.5% and Malaysia by 7.2%. Tire data: according to the latest data released by the National Bureau of statistics, China’s rubber tire output in October was 73.071 million, a year-on-year decrease of 5.9%. From January to October, the output of rubber tire casing increased by 13.8% over the same period of the previous year to 73845.2 million. Auto data: on November 24, according to the data of China passenger Federation, the overall retail sales of narrow passenger car market in the third week of November reached 49000 vehicles per day, a year-on-year decrease of 12%, and the performance was relatively improved, a decrease of 6% compared with the third week of October this year. Due to the obvious improvement of production in October, the retail recovery in November should be obvious, but the current recovery speed is still not fast, which is similar to that in 2019, and it is also a good performance.
4. In terms of inventory: the warehouse receipts increased significantly in the previous period. Statistics show that as of November 26, Tianjiao warehouse receipts were 1404700 tons, an increase of 12300 tons on a weekly basis. The total inventory of the exchange was 188350 tons, an increase of 8827 tons on a weekly basis; The No. 20 rubber warehouse receipt was 41671 tons, an increase of 91 tons. The total inventory of the exchange was 5259200 tons, an increase of 2006 tons on a weekly basis. The inventory in Qingdao Free Trade Zone continued to go to the warehouse. Due to the poor shipping, most of the orders delayed in the early stage did not arrive at the port as scheduled; As the start-up of the tire factory has picked up, the inventory has increased.
5. Import and export: China: in October, China exported 342300 tons of all steel tires, 10.33% month on month, 0.32% year on year. From January to October, China exported 3.0714 million tons, 12.05% year on year; In October, the half steel tire was 182400 tons, with a month on month ratio of – 5.6% and a year-on-year ratio of – 1.3%. From January to October, the cumulative export was 1905500 tons, with a cumulative year-on-year ratio of 19.45%. Thailand: in the first 10 months of 2021, Thailand exported 2.778 million tons of natural rubber (excluding composite rubber), a year-on-year increase of 30%, and 3.762 million tons of natural rubber and mixed rubber, a year-on-year increase of 7%; The total export to China was 1.975 million tons, a year-on-year decrease of 7%.
6. Policy: India: according to foreign media reports on November 26, once the price difference of fresh latex is 2 rupees per kilogram higher than that of rss4, the rubber board of India will provide subsidies to rubber farmers according to the price difference. The Bureau has taken measures to strengthen film production to fill the shortage in the domestic market. Thailand: according to the news from Thailand on November 24, Zhu Lin, Deputy Prime Minister and Minister of Commerce of Thailand, stressed that we should continue to promote the third year income security plan to help farmers, fight back against the claim that the prices of all crops have fallen, and pointed out that the price of cup glue (DRC 50%) is higher than the guaranteed price.
7. Tire price increase: under the comprehensive influence of environmental protection, power restriction, rising raw material prices and other factors, tire manufacturers at home and abroad have issued tire price increase notices, such as Zhongce Rubber, Linglong tire, Zhengxin tire, Fengshen tire, Qingdao Shuangxing, Qingdao Jianxin united, Zhongda & Haoyu rubber, Hubei outlets, Pu linchengshan, GM, etc.
Future forecast: natural disasters have occurred frequently in Southeast Asia recently, and it is reported that La Nina will reach the peak from the end of next month to January 2022. Another report said that a new type of Defoliation Disease broke out in the rubber forests of Tsim Chuk Mun and Dalat Prefecture in Thailand, affecting the rubber cutting rate in many ways; At the same time, China’s domestic rubber began to stop cutting, and the natural rubber supply side played a supporting role in the market; The latest data show that the demand of downstream tire manufacturers has rebounded slightly; Rubber producing countries such as India provide subsidies to rubber farmers; Several tire manufacturers issued price increase notices; In addition, the epidemic, especially Omicron, has a great impact on the world. The terminal market is depressed and the freight industry is depressed. To sum up, various factors not only support the rubber trend, but also the overall impact of macro factors this month and the sharp weakening of crude oil and coal on bulk commodities. It is expected that natural rubber will maintain the range shock trend, and the continuous weakening risk caused by recent external system risks will not be ruled out in the short term.