May 29, 2025
Rubber India
Overview
Today, Japanese rubber futures are trading within a narrow range. Traders are considering two main factors: wet weather in Thailand, a key rubber-producing country, and a price war in China’s auto market.
Market Prices
Osaka Exchange (OSE): The rubber contract for November delivery is down by 0.3 yen (0.09%), currently at 316.6 yen ($2.17) per kg.
Shanghai Futures Exchange (SHFE): The September rubber contract has decreased by 175 yuan (1.24%) to 13,895 yuan ($1,929.08) per metric ton.
June Butadiene Rubber Contract: This contract has increased by 50 yuan (0.44%), now at 11,380 yuan ($1,579.92) per ton.
Singapore Exchange (SICOM): The June delivery contract last traded at 166.8 U.S. cents per kg, up by 0.1%.
Key Factors Affecting the Market
Weather Conditions
Thailand’s Weather: The Thai meteorological agency has issued warnings about heavy rain and possible flash floods from May 28-29. This weather could damage rubber crops and delay harvesting, impacting supply.
Harvesting Season: The rubber harvesting season typically sees lower production from February to May, followed by a peak from June to September. Current weather disturbances are affecting tapping in production areas.
Auto Market Dynamics
China’s Price War: The automotive industry in China is facing intense pricing pressures, affecting major electric vehicle manufacturers. This situation raises concerns about the financial health of car companies and their suppliers, including those that produce rubber for tires.
Market Reactions: Shares of major electric car makers have dropped, indicating worries about a potential shake-out in the auto market. The performance of automobile sales can significantly influence rubber demand.
Inventory Updates
As of May 25, 2025, the total inventory of natural rubber in the Qingdao area stands at 614,600 tons, a slight increase of 400 tons (0.06%) from the previous period.
Conclusion
The natural rubber market is currently affected by adverse weather conditions in Thailand and pricing pressures in China’s automotive industry. Traders will continue to monitor these developments, as they may influence both supply and demand in the coming weeks.
