Short-term rebound is difficult to push natural rubber

Constrained by the bearish factors of supply and demand, the Hujiao Index had a new low at the beginning of the new year. On January 5th, the price linkage of Hujiao's main contract RU1205** weakened to a new 17-month low of RMB23,450 (t price, the same below). Then it rebounded. On January 12, it once rose to 25,315 yuan.

Although Thailand announced plans to spend 10 billion baht to purchase 200,000 tons of rubber at a higher market price and the Spanish and Italian government bond auctions succeeded, the European debt crisis concerns such as temporary slowdown and other major positives, on January 13 Hujiao still oscillated slightly It closed at 25,050 yuan, showing that the short-term rebound has been weak and will significantly expand the outlook for the downside.

First, the supply pressure is heavy. After 2005, rubber prices entered a rare bull market, stimulating a significant increase in the planting area of ​​rubber trees. After 5 to 7 years of growth, these new gum trees are gradually opened and put into production. According to the report of the Association of Natural Rubber Producing Countries, the area of ​​tapping in the main producing country of natural rubber has been expanded by 216,000 hectares in 2011 and will be expanded by 162,000 hectares in 2012. Global natural rubber output in 2011 was 10.1 million tons, an increase of 6.4% from 9.49 million tons in 2010. In 2012, the total natural rubber output in the world will increase to 10.415 million tons, an increase of 3.6% from 2011. Although the increase in output will be affected by the drop in natural rubber prices, the steady increase in global natural rubber supply will not change.

Second, market demand has slowed. In 2011, under the influence of unfavorable factors such as the withdrawal of preferential taxation policies for purchases, the expiration of automobile-to-country policies, restrictions on purchases in some cities, and the promotion of energy-saving and emission reduction subsidies, the slowdown in the growth rate of domestic automobile production and sales was evident. The statistics released by the China Association of Automobile Manufacturers show that in 2011, the production and sales of domestic automobiles were 18.8419 million and 18.5051 million, which increased by 0.84% ​​and 2.45%, respectively, which was 31.60 and 29.92% lower than that in 2010, and the lowest growth rate in 13 years. In 2012, which continued to lack relevant policy support, the continued slowdown in the growth of the auto market is a foregone conclusion. Tire growth is also slightly weak. From January to November 2011, China's rubber tire production reached 75.09 million, an increase of 8.46% year-on-year, an increase from the 20.7% increase in the same period last year. Affected by the slowdown in global economic growth, the current tire factory orders have slightly decreased, while the finished product inventory level is higher than before, and the operating rate is even less. It is reported that the operating rate of all-steel tires in Shandong is only 50% or 60%, and some factories have already prepared for a holiday before the Spring Festival.

Third, inventory continues to grow. Since the second half of 2011, rubber inventory levels have remained high. As of December 15, 2011, Qingdao Bonded Area stocked 188,000 tons of natural rubber, 30,000 tons of compound rubber, synthetic rubber 29,400 tons, a total of 274,300 tons, the highest level in history. Data from the Association of Natural Rubber Producing Countries also showed that the inventory of natural rubber at the end of 2011 was 1.271 million tons, an increase of 50% from the end of June 2011. By the end of January 2012, stocks may reach as high as 1.433 million tons.

To sum up, the natural rubber market, the middle and lower reaches of the industrial chain to the direction of the opposite direction, suppress the natural rubber ** market continues to fall, the short-term price is still difficult to get rid of the shock pattern, the market outlook will also likely to challenge the lower price.