ANRPC predicts short-term gain in NR prices

The Association of Natural Rubber Producing Countries (ANRPC) expects natural rubber (NR) prices to rise in the short term, due to factors such as tight supply and high demand thanks to a COVID-19-focused economic recovery. The association also expects the global consumption rates to increase by 4% year on year in December, contributing to higher prices.

However, the ANRPC anticipates a fall in the global production of NR, down 10.1% during December 2020 compared to December 2019. The spread of fungal leaf diseases affecting hectares of mature rubber trees in Indonesia, Malaysia and Thailand is expected to lower the yield of NR “considerably” for about two years; trees that are unaffected by the fungal diseases are expected to be given tapping rest from the second half of January, coinciding with the annual wintering of trees.

In addition, labour shortages are expected to continue to hurt supply, as cross-border travel restrictions prevent migrant tappers and plantation workers from returning to Thailand and Malaysia.

At the same time, the ANRPC warns of potential weaknesses in the market, such as extreme weather in major rubber-producing countries and an ease in pent-up demand in major consuming countries such as India and China.