According to the monitoring of the business agency, in mid June (11-20), the mainstream market of domestic natural rubber (standard 1) in East China market showed a trend of continuous decline first and then continuous weak fluctuation: the mainstream market in the domestic market was about 13090 yuan / ton on the 11th and 12700 yuan / ton on the 20th, a decrease of 2.98%. Among them, the highest price in this ten day period is 13090 yuan / ton on the 11th, and the lowest price is 12700 yuan / ton on the 20th.

Figure 3: trend chart of mainstream international crude oil prices since June 2022

On the macro level, on June 20, the price of international crude oil futures rose. The settlement price of the main contract of WTI crude oil futures in the United States was US $108.12/barrel, an increase of US $0.13 or 0.12%; The settlement price of the main contract of Brent crude oil futures was US $114.13/barrel, up US $1.01 or 0.89%. Oil prices rebounded slightly on Monday, the market gradually returned to rationality, and tight supply still dominated, overshadowing the impact of the slowdown in global economic growth.

Figure 4: Weekly K histogram of natural rubber market in 2022

Supply side: Southeast Asia has a large amount of supply. The rubber tapping in Yunnan is normal, and the output increases. The output in Hainan is increasing gradually, but not significantly. In addition, the local thick latex price continues to be suppressed, the water price difference between Yunnan and Hainan is narrowed, and the price of natural rubber raw materials is generally weaker. Inventory: Currently, the import volume is not large, and the domestic inventory is reduced by a small margin. Demand side: the data shows that the operating rate of China’s all steel tire sample enterprises last week was 61.70%, with a month on month increase of 14.98% and a year-on-year decrease of 0.77%. Although the enterprises started relatively well in the middle of the year, the order volume was limited, the finished product inventory was high, and the purchase volume of raw rubber had not been greatly improved; The production and sales volume of downstream vehicles increased month on month, which will consume a certain amount of tire inventory, but the continuous growth is not strong; The overall product enterprises started generally, and the de stocking of products may be driven, but the sustainability is still not very optimistic.

Future forecast: the macro policy is good, the consumption policy is frequent, but there is still a certain time lag between the implementation and acceptance, and the goods circulation conditions are improved; The output of new rubber increased, the import volume was small, and the spot inventory of natural rubber continued to be low; The inventory of finished tire products is high, mainly consumed in the short term, the operating rate of the enterprise is general, and the purchase of raw materials is limited. It is expected that with the continuous increase of production and sluggish downstream demand, the short-term natural rubber shock is likely to be weak.