Due to oversupply in the market, the market is still at risk of falling in November.

- Oct 29, 2018-



Supply pressure is heavy. The natural rubber market stocks maintained a high level. Excluding the rubber stocks of the National Reserve of about 540,000 tons, it is expected that the domestic natural rubber market stocks will still be above one million tons. In the fourth quarter, it is also the peak season for major overseas production areas. Except for India and Indonesia, which are affected by weather, floods and other factors, the production of raw materials in other producing countries will gradually increase from October to December. As the production of raw materials increases, prices or pressures decline, and foreign distributors also have to step up sales of stocks, thus making up for the possibility of low-cost new goods. The above behavior may increase the selling pressure of the external disk market, which will weaken the cost support factors of the domestic natural rubber market.


The demand performance is dull. It is reported that from January to September 2018, Shandong Port exported 42.68 billion yuan of tires, a year-on-year increase of 5.6%. This year, Sino-US trade frictions have escalated. From September 24th, the US government imposed a 10% tariff on about 200 billion US dollars of goods imported from China, involving a variety of tire products. At present, the impact on the tire export industry is relatively limited. Since January 1, 2019, the tariff rate has been increased to 25%. Such a high tariff range will inevitably affect the export of China's tires to the United States. It is expected that the export orders of tires to the United States will decrease after November, which will weaken the start of tire enterprises. .


In summary, the supply and demand pattern of the natural rubber market is weak, and the market is still under risk.