The rise in prices of Natural Rubber was witnessed due to seasonal changes and weatherinduced anomalies has been observed not just in Thailand but in some other Southeast Asian countries like the case of Indonesia and Vietnam as well. The bad weather-flodded region that covers the world’s largest rubber-producing countries is still coping with the consequences of the severe heavy rains and subsequent floods that have led to the loss of latex production and difficulty with the transportation of goods and materials to the ports.
Thailand was one of the countries that had to face the heavy rains that occurred in substantial areas of the Northern and Central Plains every day of the month of September. Plantations were submerged the whole month and therefore tapping activities were impacted. The local dealers state that their stock levels were down and the costs of procuring Natural Rubber being higher the rivalry regarding the seasonal demand is going to be a tougher one.
Indonesia and Vietnam have shared the same obstacles, such as the heavy rainfall and blocking of the transportation routes that have led to the lagging of exports and a toll on the supply chain system. It is noteworthy that these three countries, by sharing 60% of the total natural rubber output, were the biggest players in the global natural rubber market. Hence a reduction in their Natural Rubber production under any circumstances would be a major cause for concern in the international market.
On the other hand, China- the world’s top natural rubber importer- has been hurrying to finish its pre-National Day stockpile. Just before the holiday season, the expectation is that many tire companies will have to close temporarily, leaving open the short-term demand outlook. Nevertheless, the desire to secure materials before the holiday has made it difficult to conclude, and as a result, the numbers were in favor of the Natural Rubber market.
As per ChemAnalyst, the prices of natural rubber are expected to remain high during the fourth quarter. The supply of natural rubber worldwide is anticipated to get better when the tapping season resumes, still there are no guarantees in the short term because of the unpredictable weatherBringing along the seasonal ups and downs, the market is seen besieged by the disturbances in the leading producing zones. The high prices are still anticipated unless the market becomes stable and very much the greater portion of this can be attributed to the limited supply and continuing disruption in the supply chain.
