IRSG forecasts rubber growth to rebound by 7% in 2021

Singapore-headquartered International Rubber Study Group (IRSG), in its latest data on production, consumption, trade and prices, covering both natural rubber (NR) and synthetic rubber (SR), says for the year 2021 total rubber demand is forecasted to rebound by 7.1%, under the IMF Scenario.

It adds that the global pandemic continues to exert substantial pressure on world economies, targeted containment measures on resurgence/mutation of virus stalling the rebound and daily measures on mobility remain below the pre-Covid level, explains much of the downward trend in 2020 under the IMF Scenario. A stronger rubber demand in China for 2020 than other countries driven by vehicle sales in OE and replacement markets is the main driver for softening the contraction foreseen for 2020. The global rubber demand in tyre sector is expected contract steeper (-10.2%) than non-tyre products sector (-5%) in 2020. The amplitude of contraction in non-tyre sector foreseen is smaller than in tyre segment, driven by rapid surge in demand for gloves and other rubber products from the global healthcare industry.

World NR demand is expected to fall by 8.1% in 2020, reaching 12.53 million tonnes and projected to rebound by 7% in 2021, owing to strong recovery expected in CV segment in the mature and emerging markets. World SR demand is expected to decline by 7.9% reaching 13.97 million tonnes in 2020 and is forecasted to recover by 7.2% in 2021.

World NR production is expected to decline by 5.9% in 2020. Tapping days lost due to risks associated with extreme weather, spread of leaf fall disease and labour shortage during the pandemic crisis disrupted production in major producing countries in Southeast Asia. Steady production growth expected from Mekong countries and Ivory Coast is likely extended some support to offset sharp production loss in major producers in Southeast Asia. 

On a biannual basis the World Rubber Industry Outlook (WRIO) presents the latest long-term forecasts for the next ten years, covering the world economy as well as the vehicle, tyre and rubber sectors.

IRSG’s December 2020 edition of the World Rubber Industry Outlook (WRIO) is now available. The current forecast in WRIO comprises three economic scenarios, Base Case Scenario rooted from the IMF’s base line forecast; Downside Scenario, with a drag on economic activities on fight against the Covid-19 pandemic in 2021; and Upside Scenario, that assumes fight against the virus go much better than the base.