LONDON—Natural rubber markets have generally strengthened in recent weeks as the supply and demand conditions remained favorable across Asian markets.
In Shanghai, the most active rubber contract for January delivery posted a 1.3 percent increase over the two weeks to Aug. 13, while SICOM rubber futures tracked a growth trajectory with a 3.2 percent gain.
In Osaka, however, RSS3 nearby month prices fell 1.6 percent as the Japanese yen considerably lost strength against the U.S. dollar, Thai baht and Malaysian ringgit.
Physical markets continued to perform better than futures, with a sharp 7.4 percent increase in Kuala Lumpur latex, driven by tight supply.
In its latest market intelligence report Aug. 15, the Association of Natural Rubber Producing Countries linked the growth in the first two weeks to the improved demand outlook. Strong economic recovery in the U.S. and Europe supported demand while COVID-related restrictions continued to weigh on production.
Furthermore, strong demand outlook, low inventory levels and the oncoming lean NR production season in China have contributed to the strengthening of prices in the Far East markets.