Hujiao: gradually loose supply and limited upward space

Recently, with the basic digestion of the macro-negatives, the black line's impact on the linkage of rubber has weakened, and Hujiao has shown a recovery trend.
However, from the perspective of the industry itself, the price of rubber is suppressed by the shift from the supply and demand structure to a looser structure.
The increase lacks sustainability and the upward space is limited.

Since mid-May, the National Standing Committee has named the issue of commodity price increases twice in seven days.

The bulk commodities led by the black series have fallen in response.

Seasonal increase in production is coming

With the start of a new round of rubber tapping in the global natural rubber production areas, the global natural rubber production in the second and third quarters has entered a period of seasonal increase in production.

At present, the progress of opening in southern Thailand and Yunnan production areas is slow, and the prices of raw materials are relatively strong, which constitutes a certain cost support for prices in the short term.
However, in view of the relatively good phenological conditions in major global production areas this year, and the current high prices of raw materials in recent years, the enthusiasm of rubber farmers for rubber tapping has been mobilized to a certain extent, which is conducive to the rapid increase of raw materials in the later period.

The demand side is stable on the outside and weak on the inside

From the perspective of the tire market, after the Spring Festival, driven by the rising tide of tire prices, dealers’ bulk purchases resulted in relatively saturated inventory, which was significantly higher than the normal level in previous years.

However, the actual terminal demand was not followed up, especially the weak performance of the domestic replacement market.
The downward transmission of tire inventory is not smooth.

　　Passenger car sales in April continued to rise year-on-year, indicating that the passenger car market continued its recovery trend; and the month-on-month decline was mainly due to "core shortage".

Since the fourth quarter of last year, as the impact of global chip production shortages has become prominent, and manufacturers' chip inventory consumption has been superimposed, many car companies have had to face the dilemma of suspension of production and production.

　　In the heavy-duty truck market, sales in April continued the trend of setting a new monthly high for thirteen consecutive months since April last year.

Since the National VI emission of heavy diesel vehicles will be enforced from July 1 this year, various heavy truck companies are striving to compete for the market in the first half of this year, thus promoting the production and sales of heavy trucks to maintain a high level, and the supporting sales of all-steel tires have performed well.

　　In terms of export market, in April 2021, China exported 47.

14 million new pneumatic rubber tires, a decrease of 7.

　　Under the dual pressure of tire manufacturers’ total shipments decreased month-on-month and the continuous accumulation of finished product inventory, some manufacturers have artificially controlled production, thereby reducing the overall operating rate.

For raw materials, factories are not enthusiastic about purchasing, and most of them focus on on-demand procurement.

　　To sum up, the short-term supply of new rubber is less than expected, coupled with the continuous depletion of inventory in Qingdao, Hujiao warehouse receipts maintain a year-on-year low, which supports the disk.

However, the rubber supply side faces pressure to increase production in the later period, while the demand side faces weaker domestic sales and slower export sales, and the overall performance is weak.

　　Transfer from: Futures Daily

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