Head of Content, Data & Research, Helixtap

Arusha Das

Head of Content, Data & Research

Global Commodities Alternative Data and Insights

Helixtap

Helixtap collects, processes and distributes proprietary data, analyses and forecasts for the rubber, latex and automotive markets

Commodities

<ul><li>A multitude of shocks caused by disruptive events ranging from the Covid-19 pandemic to geopolitics, with the ongoing war in Ukraine, has put the global supply chain in a fragile spot.</li><li>Moreover, given ASEAN-dominated rubber production, the supply chain snags have caused backups in the outflows weighing demand and prices. As the rubber industry navigates through these changes, one needs to think beyond product costs and supplier choices, especially with inflation and supply shortages are expected to continue.</li><li>It becomes imperative to look into the situation more objectively as the impact of the recent sanctions of Russia ripples into the market. Rubber sees the reverse reaction Given Russia's limited presence in natural rubber production, the rubber supply was insulated from the impacts of sanctions.</li></ul>

A multitude of shocks caused by disruptive events ranging from the Covid-19 pandemic to geopolitics, with the ongoing war in Ukraine, has put the global supply chain in a fragile spot.Moreover, given ASEAN-dominated rubber production, the supply chain snags have caused backups in the outflows weighing demand and prices. As the rubber industry navigates through these changes, one needs to think beyond product costs and supplier choices, especially with inflation and supply shortages are expected to continue.It becomes imperative to look into the situation more objectively as the impact of the recent sanctions of Russia ripples into the market. Rubber sees the reverse reaction Given Russia's limited presence in natural rubber production, the rubber supply was insulated from the impacts of sanctions.

Supply Chain Snags Seen Stretching Through 2022 – Is Rubber In Trouble?

CEO, Helixtap

Farah Miller

<ul><li>The Indian government's move to introduce new rubber legislation to update the functioning of the domestic rubber industry and the rubber board triggered apprehensions among market participants and experts as it might undermine the position of the farmers and the Rubber Board. Given the bill is implemented, the rubber farmers would be given the industrialist status as the Rubber sector gets industry status.</li><li>As a result, Central Government would be responsible for setting up the floor and ceiling price, limiting the Rubber Board's authority over price settlement.  Meanwhile, according to industry reports, the bill's implementation might be detrimental for the farmers as a ceiling price will help downstream industries like tire manufacturers more than the rubber farmers.</li><li>For instance, it might limit the farmers to benefit from the surge in the international rubber prices as the bill provisions for the government to put a ceiling on domestic prices.</li></ul>

The Indian government's move to introduce new rubber legislation to update the functioning of the domestic rubber industry and the rubber board triggered apprehensions among market participants and experts as it might undermine the position of the farmers and the Rubber Board. Given the bill is implemented, the rubber farmers would be given the industrialist status as the Rubber sector gets industry status.As a result, Central Government would be responsible for setting up the floor and ceiling price, limiting the Rubber Board's authority over price settlement.  Meanwhile, according to industry reports, the bill's implementation might be detrimental for the farmers as a ceiling price will help downstream industries like tire manufacturers more than the rubber farmers.For instance, it might limit the farmers to benefit from the surge in the international rubber prices as the bill provisions for the government to put a ceiling on domestic prices.

New Indian Rubber Bill Triggers Apprehension, Might Weigh On Producers

<ul><li>Malaysian rubber production & exports rebound in Jan  The Malaysian rubber market rebounded in January 2022, supported by an uptick in global manufacturing activities, some global rubber supply shortage, surging crude prices, and a weak ringgit against the US dollar. Natural rubber production increased by 17.7% in January 2022 to 49,087 tons, from 41,690 tons in December 2021, while year-on-year production clocked a rise of 7.3%.</li><li>However, the contribution of smallholders dropped to 89.1%, down from 91% in December, while the estates contributed about 10.9% in January 2022.  The rubber inventory increased by 8.7% to 310,052 tons in January 2022, with rubber processors’ factories contributing 92.3%, followed by rubber consumers factories at 7.6% and rubber estates. Source: DSOM & Helixtap Standard Malaysian Rubber (SMR) 20 prices saw a rise of around 5% over January, given the supply shortage due to some disruption in tapping activities in Thailand, according to Helixtap data.</li><li>As a result, SMR 20 closed the month of January at US$1850/mt on FOB basis.</li></ul>

Malaysian rubber production & exports rebound in Jan  The Malaysian rubber market rebounded in January 2022, supported by an uptick in global manufacturing activities, some global rubber supply shortage, surging crude prices, and a weak ringgit against the US dollar. Natural rubber production increased by 17.7% in January 2022 to 49,087 tons, from 41,690 tons in December 2021, while year-on-year production clocked a rise of 7.3%.However, the contribution of smallholders dropped to 89.1%, down from 91% in December, while the estates contributed about 10.9% in January 2022.  The rubber inventory increased by 8.7% to 310,052 tons in January 2022, with rubber processors’ factories contributing 92.3%, followed by rubber consumers factories at 7.6% and rubber estates. Source: DSOM & Helixtap Standard Malaysian Rubber (SMR) 20 prices saw a rise of around 5% over January, given the supply shortage due to some disruption in tapping activities in Thailand, according to Helixtap data.As a result, SMR 20 closed the month of January at US$1850/mt on FOB basis.

Malaysian Rubber Production & Exports Rebound In Jan

<ul><li>The rally in crude oil prices rippled across the Indian natural rubber market as prices rose around 3% in March despite the elevated inventory levels owing to higher imports in November and December 2022.</li><li>  With crude prices staging a comeback and crossing US$100 per barrel on mid of last week, the natural rubber price (RSS-4) hit US$2.25 per kg on March 17, after hitting its lowest January 2022 at US$2.17 per kg when the crude was at US$83.92 per barrel. When the global crude oil prices reached an average of above US$100/barrel in 2011, Indian natural rubber prices reached an all-time high of US$3.26 per kg.</li><li>However, prices saw a steady upswing in 2022 despite the overall bearishness of the pandemic after-effects and ongoing Russia-Ukraine conflict. "The natural rubber market movement in India is predominantly determined by several endogenous and exogenous factors like demand and supply, automobile sales, crude oil price, climatic factors in major producing countries, movements in the futures market, GDP growth rate, currency movements etc.</li></ul>

The rally in crude oil prices rippled across the Indian natural rubber market as prices rose around 3% in March despite the elevated inventory levels owing to higher imports in November and December 2022.  With crude prices staging a comeback and crossing US$100 per barrel on mid of last week, the natural rubber price (RSS-4) hit US$2.25 per kg on March 17, after hitting its lowest January 2022 at US$2.17 per kg when the crude was at US$83.92 per barrel. When the global crude oil prices reached an average of above US$100/barrel in 2011, Indian natural rubber prices reached an all-time high of US$3.26 per kg.However, prices saw a steady upswing in 2022 despite the overall bearishness of the pandemic after-effects and ongoing Russia-Ukraine conflict. "The natural rubber market movement in India is predominantly determined by several endogenous and exogenous factors like demand and supply, automobile sales, crude oil price, climatic factors in major producing countries, movements in the futures market, GDP growth rate, currency movements etc.

<ul><li>The rubber glove market witnessed an uptick in demand amid the recent Covid-19 outbreak in China, close on the heels of the Russia-Ukraine conflict and endemic globally, which drove down the demand. The lockdowns in several key Chinese areas following the new pandemic outbreak have triggered an optimistic outlook regarding the demand for rubber gloves amid supply woes for China, which accounts for 10 percent of the global exports.</li><li>The Ukraine war and easing of Covid-19 in most parts of the world had already taken the demand for rubber gloves to pre-pandemic levels. The Malaysian glove stocks registered a rise at the start of this week, with China imposing a lockdown in Shenzhen, Shanghai, and many other parts after detecting several new Deltacron cases. Post the onset of the pandemic in 2020, China had ramped up its glove production.</li><li>China has an edge in producing synthetic gloves, while Malaysia has dominated the scene for over three decades with latex.</li></ul>

The rubber glove market witnessed an uptick in demand amid the recent Covid-19 outbreak in China, close on the heels of the Russia-Ukraine conflict and endemic globally, which drove down the demand. The lockdowns in several key Chinese areas following the new pandemic outbreak have triggered an optimistic outlook regarding the demand for rubber gloves amid supply woes for China, which accounts for 10 percent of the global exports.The Ukraine war and easing of Covid-19 in most parts of the world had already taken the demand for rubber gloves to pre-pandemic levels. The Malaysian glove stocks registered a rise at the start of this week, with China imposing a lockdown in Shenzhen, Shanghai, and many other parts after detecting several new Deltacron cases. Post the onset of the pandemic in 2020, China had ramped up its glove production.China has an edge in producing synthetic gloves, while Malaysia has dominated the scene for over three decades with latex.

Malaysian Rubber Glove Demand Set To See A Boost

Singapore

SGX Technically Specified Rubber 20 (TSR20) Futures: Effective from 16th May 2011, this contract will be migrated from SICOM platform to the SGX-DT platform. It will cease trading on SICOM at the close of business day Friday, 13th May 2011. Trading hours are revised as 7.55am to 6.00pm (no lunch break). Please refer to SGX products website for the new revised contract specifications. Exchange symbol: TF. Product Specifications: https://www2.sgx.com/derivatives/products/sicom-rubber?cc=TF

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SGX Rubber Future TSR20 (ORA COMDTY)

Supply Chain Snags Seen Stretching Through 2022 – Is Rubber In Trouble?

A multitude of shocks caused by disruptive events ranging from the Covid-19 pandemic to geopolitics, with the ongoing war in Ukraine, has put the...

Helixtap

New Indian Rubber Bill Triggers Apprehension, Might Weigh On Producers

The Indian government's move to introduce new rubber legislation to update the functioning of the domestic rubber industry and the rubber board...

Helixtap

Malaysian Rubber Production & Exports Rebound In Jan

The Malaysian rubber market rebounded in January 2022, supported by an uptick in global manufacturing activities, some global rubber supply...

Helixtap

Indian NR Prices Get The Oil Push

The rally in crude oil prices rippled across the Indian natural rubber market as prices rose around 3% in March despite the elevated inventory...

Helixtap

Malaysian Rubber Glove Demand Set To See A Boost

The rubber glove market witnessed an uptick in demand amid the recent Covid-19 outbreak in China, close on the heels of the Russia-Ukraine conflict...

Helixtap

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52-week Range

Market Cap (USDm)

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