Commodity index: According to the monitoring of the business community, the natural rubber commodity index on October 15 was 36.01, unchanged from yesterday, down 63.99% from the highest point of 100.00 (2011-09-01) in the cycle, and up 32.00% from the lowest point of 27.28 on April 2, 2020. (Note: Period refers to 2011-09-01 to now)
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Figure 2: Natural rubber mainstream price trend since October 2022
Commodity market: According to the monitoring of the business community, the spot market of domestic natural rubber (Standard 1) in the East China market in the first half of October showed a weak downward trend. Although it occasionally rebounded slightly, it generally weakened; Among them, since the trading day after the National Day, the East China market reported 12340 yuan/ton on October 10 and 12142 yuan/ton on October 15, down 1.6%.
Figure 3: Weekly K Histogram of Natural Rubber Market in 2022
Industry: According to the monitoring of the business community, the supply side: the supply of natural rubber continued to be strong in October, and the natural rubber of the main producing countries continued to be in high volume. The September report released by ANRPC around October 8 predicted that the global natural rubber output in September was expected to increase by 3.7% to 1.38 million tons, an increase of 5.1% over the previous month; In 2022, the global gum output will increase by 2.3% to 14376000 tons, including 0.9% in Thailand, 2.9% in Indonesia, 1.8% in China, 12.3% in India, 1.3% in Vietnam and 14.8% in Malaysia. The price trend of natural rubber has weakened. Although the price of raw materials in Thailand has risen slightly due to the weather, it is not sustainable. The purchase price of Hainan made full emulsion glue of domestic rubber has also dropped by about 300 yuan/ton and remained below 10000 yuan/ton. Demand side: First of all, in terms of the operating rate of tire enterprises, the weak procurement of downstream enterprises before the festival improved after the festival, and the operating data of tire enterprises picked up slightly. The data showed that the operating load of domestic tire enterprises was 41.67% in the week from September 30 to October 6, and the operating load of domestic tire enterprises was 64.69%, up 23.02 percentage points month on week and 10.13 percentage points year on year. Secondly, in terms of tire production, China’s total production of all steel tires in September 2022 was 10.891 million, up 12.54% year on year and down 1.44% month on month. From January to September 2022, China’s total output of all steel tires was 91.5325 million, a year-on-year decrease of 7.67%. In September 2022, China’s total production of semi steel tires was 41.8634 million, up 13.04% year on year and down 0.14% month on month. From January to September 2022, China’s cumulative production of semi steel tires was 363.0439 million, down 0.63% year on year. The cumulative production of all steel tires and semi steel tires was lower than that of last year. In general, the output and import volume of natural rubber continued to increase, the downstream demand was weak to the price of rubber was weak, and the mixed rubber was not enough to keep up with the growth; The market reflects that it is difficult to do business in natural rubber this year, so far, it has not presented the previous “golden nine silver ten” peak season, and the market has weakened recently.
Figure 4: Trend Chart of International Crude Oil Mainstream Prices in Recent March 2022
Macro: On October 12, international crude oil futures closed down. As of Wednesday of the week, oil prices had fallen for three consecutive days; On the 13th, the stock market rebounded strongly after falling, which boosted risky assets such as crude oil. International crude oil futures rebounded. The settlement price of the main contract of US WTI crude oil futures was 89.11 dollars/barrel, up 1.84 dollars or 2.11%; The settlement price of the main contract of Brent crude oil futures was 94.57 dollars/barrel, up 2.12 dollars or 2.29%. With regard to the future market, the US Energy Information Administration (EIA) inventory data shows that the diesel and heating oil inventories have declined significantly, overshadowing the negative impact of the increase in crude oil and gasoline inventories.
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Recent hot spots:
1. In September 2022, China’s heavy truck market will sell about 52000 vehicles (invoicing caliber), up 13% month on month and 12% lower than 59200 vehicles in the same period last year. 52000 units are the lowest sales volume in September since 2016, and September this year is also the 17th consecutive month of decline in the heavy truck market since May last year. Downstream demand is sluggish and inventory is high, and heavy truck sales are lower than expected.
2. According to the data released by the China Automobile Association recently, auto production and sales continued to grow rapidly in September, highlighting the nature of the traditional sales peak season. In the same month, the production and sales of 2.672 million and 2.61 million vehicles respectively increased by 11.5% and 9.5% month on month, 28.1% and 25.7% year on year. The month on month growth turned from negative to positive, and the year-on-year growth rate was slightly lower than that of last month. From January to September, the production and sales of automobiles reached 19.632 million and 19.47 million respectively, up 7.4% and 4.4% year on year, 2.6 percentage points and 2.7 percentage points higher than that from January to August.
Figure 5: Comparison Chart of Annual Spot Market Trend of Natural Rubber from 2020 to 2022
Future forecast: the international crude oil price fell, the global economic outlook was weak, the heavy truck market demand was sluggish and the sales volume was lower than expected. Under the influence of the industrial chain, its demand for tire enterprises was weak, and the market trend of natural rubber as its raw material continued to be sluggish, and was weaker than the trend of natural rubber in 2021 and 2020. According to recent news, Malaysia has indicated that it will cooperate with Thailand and Indonesia in various aspects to stabilize the price, including jointly setting the minimum rubber price.
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