Synthetic rubber will squeeze more market share of natural rubber

Shanghai Natural Rubber Futures May contract rose 0.57% in the morning on the 20th. The pressure on the capital market in North Korea has gradually weakened, and the market expects China to relax its economic policies. The speculation that Chinese traders are gradually increasing their purchases is also supporting rubber prices, but the increase in synthetic rubber production has limited the increase.

On the 19th, the January crude oil contract on the New York Mercantile Exchange rose to $93.88 a barrel, or 0.4%. EU finance ministers said that the euro zone member countries will provide the IMF with additional resources of 150 billion euros. The statement stated that these funds will be provided to the IMF through bilateral loans. This has eased the market's concerns about the European debt crisis. The evolution of the political situation in Asia has also had an impact on oil prices. Representatives of 11 countries, including the United States and Saudi Arabia, plan to meet in Rome to discuss matters related to sanctions on Iraq’s oil exports. This will lead to an increase in tension around Iraq, one of the world’s largest oil producers. The rise in crude oil will increase the cost of synthetic rubber and will benefit the natural rubber market.

Weather conditions, natural rubber producing areas in Thailand, clear and cloudy in the north-central part of Thailand, cloudy in the south, Malaysian areas, rain in the southern part of the Malay Peninsula, rain in the northern part of Kalimantan Island, Indonesia, Sumatra has rain in the north of the equator, Sumatra There is rain south of the island’s equator, rain in southern Kalimantan, and in China, Hainan is cloudy, and Yunnan is sunny. Recent weather has little effect on tapping production and transportation.

Asian spot market, the previous trading day, prices fell. China's large-scale consumer and importers are looking for supplies before the arrival of New Year's Day. The Thai No. 3 smoke tablet Adhesive RSS3 reported in January was reported at 338 cents per kilogram. On the 20th, Malaysia's standard rubber SMR20 January FOB official offer rose sharply in the morning.

In other respects, in November 2011, China produced 295,000 tons of synthetic rubber, an increase of 9% year-on-year. From January to November, the national output of synthetic rubber reached 3.175 million tons, a year-on-year increase of 14%. The first three provinces of synthetic rubber production were Jiangsu, Shandong and Guangdong, which accounted for 26%, 15% and 11% of the total production respectively. Despite the decline in production in November, the annual output growth rate remained significant. China's synthetic rubber reaches more than 3 million tons and will compete for more natural rubber market share.

In general, the commodity market continues to turn upwards. Europe's injection of funds into the IMF has taken an important step in resolving the European debt crisis. The United States will release some economic data this week and it is expected to be more optimistic. The market is also looking forward to the relaxation of China’s policies. The external situation is slightly more favorable to the rubber market. The rubber market continues to digest supply pressure to gain support. There are signs that Chinese buyers are gradually buying cash. Despite this, the recently released synthetic rubber production data has brought new pressure. China's synthetic rubber reached 3.17 million tons in the first 11 months, and synthetic rubber will squeeze its market share in natural rubber. Trends in the past two years have shown that China and India are more inclined to increase consumption of synthetic rubber. In addition, Japanese rubber stocks are in a high position, which also limits price increases. The market will be flat rather than rapid.