I. price trend
According to the data of business agency (100ppi. Com), on November 1, 2019, the average domestic market price of China’s natural rubber (standard I) was 11230 yuan / ton, and on November 25, the average market price was 12116 yuan / ton, with a maximum increase of 7.89% in the month. After the price correction, as of 29, the price was back to 11790 yuan / ton. Among them, the price of 12116 yuan / ton on the 25th is the highest price of rubber so far in the 2019 market monitored by the business association. As can be seen from the above figure, since 2019, the market of natural rubber has fluctuated from 10000 yuan / ton to 12200 yuan / ton; there have been three times of high price: 12070 yuan / ton on March 4 is the first high price, 12020 on June 11 is the second high price, and the price of 12116 yuan / ton on November 25 is the current highest price in the year; two times of low price: 10700 yuan / ton at the end of April and the beginning of May is the second high price A low price, 10260 yuan / ton at the end of July and the beginning of August is the lowest price this year. In general, November 2019 is a month of strong trend for the market. To the first ten days of December, natural rubber continued the trend of November, with a high short-term callback and shock consolidation; until the fourth day, stimulated by the news of Thailand’s rubber strategic production reduction, the fund continued to focus on Tianjiao, which rose strongly again that day, with Shanghai rubber up more than 400 points, and then the spot rubber price rose with the rise in the next few days; in Tianjiao’s upward market, the market transaction was a little wait-and-see.
Natural rubber, which has been in a weak position for several years, has been fluctuating for more than half a year in the low price range around 2000 yuan / ton in 2019, falling to the annual lowest level in June, and has been in full swing since May. In the second half of May, the price of rubber fluctuated constantly, and experienced the traditional peak season of “golden nine silver ten”. In addition, Southeast Asia was affected by rainstorm and fungal disease, and the output was limited. The natural rubber market started to improve from November. In November, China’s Yunnan Province began to enter the cut-off period. At this time, funds gradually favor natural rubber. On the day of the beginning of the last ten days, natural rubber finally stopped falling and rising. Shanghai rubber has a large amount of funds, and the market is strong. After a short-term correction at the end of November and the beginning of December, the price of ru2005 rose by 3.57% on a single day. The highest price in the session was 13380 yuan / ton, which was the highest in the year. The price of NR 2003 of 20 rubber also rose sharply. The spot rose in the following days. The waiting mood of the purchasing end was strong, and the prices of 9 and 10 were slightly reversed. According to the monitoring data of business agency (100ppi. Com), the lowest price of natural rubber (Hainan standard 1) in the first ten days of December is 11790 yuan / ton on the first day, and the highest price is 11290 yuan / ton on the sixth to the eighth day, with a 10 day increase of 4.2%. Natural rubber is still in a strong market trend.
II. Market analysis
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In terms of supply, at the end of November in Yunnan, about one-third of the cutting has been stopped. In the first ten days of December, the cutting has been basically stopped. In Hainan, the cutting will also be stopped from December. Overseas, Southeast Asia should be in the traditional peak season in terms of season. However, due to the influence of fungal diseases and rainwater in the previous period, the overall production in 2019 is expected to be affected: according to the international tripartite rubber Council (ITRC) report, in 2019, the rubber production in Thailand, Indonesia and Malaysia is expected to be reduced by 800000 tons. In addition, the southern part of Thailand is affected by rainwater, and the raw materials in Thailand are expected to be reduced Recently, the Thai government agreed to adopt the 20-year rubber strategic plan formulated by the rubber Bureau of Thailand, which proposed to reduce the rubber planting area, increase the average unit area output of the rubber Park, increase the rubber planting income, increase the total rubber export value, and increase the domestic rubber utilization area, so as to promote the rubber industry and create a framework for the development and problem-solving of the entire rubber system , the above news plays a strong role in the market. In general, the total output of natural rubber in domestic and foreign production areas is reduced, stimulating the price to keep rising, and the recent support of raw rubber cost side has a strong impact on Tianjiao market.
In terms of inventory, the data of the previous period shows that on November 29, 2019, the natural rubber inventory of the previous period decreased by 261259000 tons to 22828200 tons, and the warehouse receipts decreased by 29368000 tons to 1672600 tons; in the week of December 6, the Tianjiao inventory was 255200 tons, and the warehouse receipts on October 10 were 184600 tons, slightly increased compared with the end of November. By contrast, the rubber inventory of the previous period is still at a low level. According to the news, Qingdao’s inventory has picked up slightly in the near future. The change of natural rubber inventory has a strong supporting effect on the recent Tianjiao market, but it has not entered into the state of de stocking.
In terms of import and export, China’s customs data shows that in October 2019, China’s imports of natural and synthetic rubber (including latex) were 500000 tons, down 8.4% from 546000 tons last month; from January to October, China’s total imports of natural and synthetic rubber (including latex) were 5213000 tons. In Southeast Asia, Thailand’s natural rubber exports in October fell 24% year-on-year and rose 8% month on month, benefiting from the expiration of Thailand’s four-month export restriction order at the end of September, and Thailand said it would adopt policies to support rubber farmers.
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In terms of demand, the current operating rate of downstream tire enterprises is about 70%, and the demand for rubber procurement also needs to consider the influence of seasonal factors and environmental protection factors. Under the situation of strong market expectation, the purchasing end will generally wait and see. According to the data, in November 2019, China’s heavy truck market is expected to sell about 94000 vehicles of various types, up 3% on a month on month basis, up 5.3% on a year-on-year basis. Overload control and elimination of national three vehicles lead to an increase in new car purchase. Winter is the off-season of tire seasonal sales. In November, tire sales have declined compared with the same month on month, and dealers are under great pressure. However, before the year, there will be a demand for goods in the downstream, which may have a short-term support for the market.
III. future forecast
According to the natural rubber analysts of the business club, the total output of natural rubber is tighter than that of previous years, and the inventory is at a relatively low level in recent years. In the near future, the heavy truck sales are good, and the downstream procurement is relatively stable. In addition, the stock up demand before the year will generally have some support, and the expectation of stronger future market trend is strong. Recent market shocks, prices did not reduce how much, short-term favorable factors exist, spot rubber prices strong.
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