Seasonal accumulation of inventory Natural rubber market trend is weak

On the macro front, since late December, the impact of market sentiment on the Omicron variant has weakened, concerns about slowing fuel demand have eased, and crude oil prices have rebounded
slightly.

On the supply side, although due to the spread of the epidemic and rainfall, the output is not as strong as in previous years, but the rainfall in southern Thailand tends to decrease, the total output of new rubber in the main producing areas of Southeast Asia is still in the period of increasing production, and the price of glue is basically stable; Rainfall gradually decreased in the main producing areas of Vietnam and Indonesia, and raw material prices fell
.
China has entered a cold winter period, and typhoon "Rey" will approach Hainan Island and bring rainfall, most of the rubber production areas have been stopped, the price of glue is high, and the upstream profit is low
.

On the demand side, as of December 16, 2021, the operating rate of all-steel tires of downstream tire companies was 63%, down 1.
3 percentage points from the previous month, and the operating rate of semi-steel tires was 64%, up 0.
2 percentage points
from the previous month.
Market demand is sluggish, tire inventory is seasonally accumulated, similar to the same period of previous years, affected by cost growth and other factors, major tire brands have experienced multiple price increases, and some brands have increased by about 10% on average than the price in the first half of the year
.
Tire tire production in November increased
sharply month-on-month.
According to data from the National Bureau of Statistics, the production of rubber tire tires in November was 80.
42 million, an increase of 7.
35 million from the previous month and a decrease of 2.
82 million from the same period last year
.
Statistics show that the production of all-steel tires in November was 11.
44 million, an increase of 1.
22 million from the previous month
, and the production of semi-steel tires was 42.
96 million, an increase of 4.
87 million from the previous month.

In terms of inventory, the increase in warehouse receipts in the previous period was obvious, the inventory in Qingdao Free Trade Zone continued to be destocked, the total inventory in Qingdao continued to decrease, and the growth rate of warehouse receipts was relatively fast
.
On the transportation side, Southeast Asian sea freight has not declined, and transportation costs are high
.

Weather conditions in Southeast Asian production areas have improved recently, production is normal, and price support has weakened; Typhoons in China's production areas are approaching, and the process of stopping cutting is accelerating
.
The operation of tire enterprises is relatively stable, inventory is seasonally accumulated, and the increase in costs has led to frequent price increases of tires; The freight industry is sluggish and costs are high
.
In summary, it is expected that the trend of natural rubber in the future market is weak
.