Consortium predicts uptrend in NR prices in first half

BANGKOK—Global economic recovery and a continued tightness in supply will buoy natural rubber prices in the first half of 2023, according to the International Rubber Consortium (IRCo).

In a Dec. 14, 2022, report analyzing NR market trends, IRCo said production may not increase "at a large scale" in the coming months in the three major producing countries of Thailand, Indonesia and Malaysia.

This was due mainly to the spread of the leaf disease, erratic weather conditions, increasing climate temperatures as well as low fertilizer-input caused by elevated costs, it said.

A drought situation in the region and an early departure of tappers from plantations because of low NR prices are further impacting output, IRCo added.

Citing the latest statistics from the Association of Natural Rubber Producing Countries, the report forecast 2022 production to reach 14.343 million metric tons.

And with consumption expected to come in at 14.805 million tons, the global market is set for a deficit of 462,000 tons for last year.

Furthermore, NR production in Thailand is expected to be lower during the wintering periods in April, May and June 2023.

This, according to IRCo, will likely also apply to Indonesia and Malaysia, affecting the overall NR output in the region by around 10 percent in the first half of 2023.

IRCo also forecasted an improvement in the global economy and a de-escalation in the Russia-Ukraine war over the next 12 months.