WASHINGTON (Aug. 30)—Contradictory market forces are making natural rubber prices impossible to predict for the near future, according to sources within the NR trade.
On one hand, Chinese NR demand is down as supply remains strong and production heads into its peak months; on the other, high petroleum prices are causing some consumers to turn to NR, because of rising synthetic rubber costs.
"There's been a lot more interest from consumers over the past month," said one industry source who asked to remain anonymous. "Producers aren't selling very far forward, perhaps reflecting a thought process that several months from now the price of shipments will be higher than now."
The Aug. 27 price of Standard Indonesian Rubber 20—the rubber grade most often used by U.S. tire makers—was 50½ cents per pound at the port of origin, identical to a month before and about 5 cents lower than the May price.