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    Home > Chemicals Industry > Rubber Plastic News > In 10 years, the price of glue has dropped by nearly 70%

    In 10 years, the price of glue has dropped by nearly 70%

    • Last Update: 2021-08-30
    • Source: Internet
    • Author: User
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    Prices continue to be sluggish, and planting income has fallen sharply.
    .
    .
    The reporter recently investigated in Yunnan, Hainan and other major natural rubber producing areas in China and found that the continuous decline in rubber prices in the past 10 years has caused the development of the natural rubber industry to be in trouble, "low rubber hurts farmers" and "cost upside down" Such words frequently come from the interviewees
    .
    What caused the long-term low price of natural rubber? When will the glue price be repaired upwards? Can this important strategic material get out of the cycle cycle? The reporter launched an investigation
    .
    In 10 years,rubber prices have dropped by nearly 70%.
    Natural rubber is an important industrial raw material.
    China's natural rubber industry is mainly distributed in Yunnan, Hainan, Guangdong, Guangxi and other places .
    Statistics show that China's natural rubber planting area is about 17.
    18 million mu, ranking third in the world, second only to Indonesia and Thailand .
    In terms of output, China's total output of natural rubber is about 810,000 tons, ranking fourth in the world, second only to Thailand, Indonesia and Vietnam .
    "Since 2011, rubber prices have been declining, from the highest level of 43,000 yuan/ton to less than 12,000 yuan/ton in 2020.
    " Ma Tao, director of the Development and Reform Commission of Xishuangbanna Prefecture, Yunnan Province, said Xishuangbanna is a natural rubber in Yunnan Province.
    In the main production area of ​​China, rubber has become a pillar industry for increasing farmers’ income and solving employment.
    However, the continued low rubber prices have brought considerable challenges to the economic and social development of Xishuangbanna .
      Since the beginning of this year, the price of rubber futures once rebounded to around 17,000 yuan per ton, but with the downturn in downstream demand, the price of rubber fell again, and the current market price is hovering around 13,000 yuan per ton .
    In the past 10 years, with the exception of the two rounds of rebounds at the end of 2020 and the beginning of this year, as well as the end of 2016 and the beginning of 2017, rubber prices have continued to fall, and many periods have fluctuated at low levels near the cost line .
    Ruan Linguang, general manager of Yunjiao Group Jingyang Company, told reporters that the fall in rubber prices has led to a sharp drop in the income of rubber farmers, and the enthusiasm of rubber farmers for planting natural rubber has weakened.
      
    .
    After the rubber plantations were renewed and felled on individual farms, they no longer planted gum trees and switched to tropical fruits
    .


      At the beginning of 2020, the sudden new crown pneumonia epidemic made the originally sluggish rubber price worse.
    The supply and demand of natural rubber recovered below expectations.
    The pessimistic demand forecast caused the price of natural rubber per ton to fall below 10,000 yuan
    .
    With the effective control of the epidemic in China and the acceleration of the resumption of work and production in various industries, the price of rubber has slowly recovered, but the market demand is still weak
    .


      Since the beginning of this year, global commodity prices have risen, and natural rubber is one of the rare raw materials that have fallen in price
    .
    Data show that the main natural rubber futures contract fell by more than 7% in the first half of the year, which was far lower than the increase of crude oil and other commodities in the same period.
    Among the more than 50 major raw materials in the domestic market, the decline ranked second
    .


      The fundamentals of oversupply of rubber have not changed.


      Why does the price of rubber continue to be sluggish? The reporter learned through investigation that once stimulated by favorable prices, the plantation area of ​​natural rubber in the world has surged, and now it has reached more than 230 million mu, and Southeast Asia accounts for about 90% of the global plantation area of ​​natural rubber
    .


      "Since 2002, due to the soaring international rubber prices, the rubber industry has developed rapidly.
    Many growers have blindly expanded and planted in ultra-altitude, ultra-slope, and ultra-planned areas
    .
    " Li Guohua, director of the Yunnan Institute of Tropical Crop Science, told reporters that global rubber The increase in planting area has brought serious overcapacity.
    Production has surged from 6.
    8 million tons in 2000 to the current 13.
    8 million tons, while the actual demand is smaller than the supply
    .


      Mo Yeyong, a researcher at the Rubber Research Institute of the Chinese Academy of Thermal Sciences, said that from 2005 to 2012, the price of rubber went up, and the planting area in the main producing countries of natural rubber increased
    .
    After new rubber trees were added to produce rubber, the slowdown in global economic growth has led to overcapacity of rubber
    .
    Since 2011, affected by the European debt crisis and the continued strength of the U.
    S.
    dollar, international commodity prices have fallen sharply, and the contradiction between supply and demand for natural rubber has intensified.
    The international natural rubber market price has continued to fall at an average annual rate of more than 20%.

    .


      It is worth noting that, as an agricultural product, rubber cultivation has a longer production cycle
    .
    "Generally, rubber production begins 7 to 8 years after rubber planting, and the duration is about 30 years
    .
    " According to industry insiders, for rubber farmers, 7 to 8 years after rubber planting, the investment needs to be divided evenly until the start of rubber tapping.
    The recovery during the nearly 30 years after production means that once the rubber farmers make a planting decision, most of their income is "handed over" to the market
    .


      Beginning in 2017, the rubber “insurance futures” project began to operate.
    Insurance companies developed relevant price insurance or income insurance based on natural rubber futures prices in the futures market.
    The price risks faced by insurance companies were transferred through the futures market for rubber farmers.
    Increasing income has achieved obvious results
    .
    "It is equivalent to helping the rubber farmers sell a good price through financial means, but in general this'good price' must be reachable in the market conditions throughout the year, otherwise financial institutions will face risks and the increase in income will be difficult to sustain.

    "Analysis of industry insiders
    .


      Data show that by the first half of this year, the global natural rubber production capacity is still growing
    .
    According to data from the Association of Natural Rubber Producing Countries, in the first May of this year, global natural rubber production increased by nearly 8% year-on-year, while demand increased by 7.
    3% year-on-year
    .
    "The market is more concerned about poor expectations.
    With the decline in auto production and sales, the market also predicts that the best period for downstream demand support has basically passed
    .
    " said Cheng Wei, head of the research department of a private equity fund in Shanghai
    .
    What is the future trend of rubber prices?   The fundamentals of market supply and demand are the basis for determining prices .
    Some analysts believe that with the increasing supply of domestic natural rubber, the pressure on the supply side is gradually increasing, and the domestic output situation is bad for the market.
    However, the main overseas production area in Southeast Asia is generally bullish for the natural rubber market due to the epidemic.
    However, in terms of downstream orders, The operating rate of downstream tire companies was lowered for a while, and then rebounded, but the current downstream procurement demand is still weak .


      

      According to data from CCB Futures, the current tire industry’s operating rate has fallen more than expected.
    As of mid-to-late June, the operating rates of all-steel tires and semi-steel tire companies were less than 60%.
    At the same time, the inventory in Qingdao Free Trade Zone is about 90,000 tons, which is in Relatively low
    .
    "With the digestion of inventories, merchants holding spot goods have a slower shipping mentality, which provides certain support to the market, but the overall lack of downstream demand puts pressure on the market
    .
    " Jinlianchuang's analysis believes
    .


      "From the perspective of supply, inventory, imports and downstream demand, long and short will continue to compete in the short term, natural rubber will maintain a volatile trend in the short term, and the overall trend will be weak
    .
    " Business agency analysis predicts
    .


      The research of Changan Futures also believes that from the perspective of supply and demand in the later market, domestic production has increased, and Southeast Asia has entered a production release period.
    Later production is likely to increase.
    On the demand side, the maximum period for China's automotive industry to improve margin has passed.
    , The probability of later stabilization is likely to stabilize, and the fundamental pattern is generally weak.
    If the later consumption falls short of expectations, natural rubber may fall into an oversupply situation again
    .


      However, many analyses also predict that rubber prices may soon usher in a long-term turning point
    .
    "In the short term, May is usually the beginning of the tire industry's off-season, and June, July and August will be even lighter.
    At the same time, heavy trucks are an important driving factor for the growth of rubber terminal consumption.
    Various signs indicate that the heavy truck cycle may have ushered in.
    End point
    .
    "

      From the perspective of longer-term supply, analysis by New Century Futures, CCB Futures and other institutions predicts that the expansion of planting has made natural rubber prices weak for up to 10 years, and the tapping area or output is likely to reach in the near future.
    Peak, coupled with the impact of monetary policy "release water", rubber prices are likely to usher in a long-term inflection point
    .


      "From a cyclical point of view, the release of production capacity has basically entered the end, and from a price point of view, it is basically close to the cost line
    .
    " Peng Haozhou, an analyst at CCB Futures, believes
    .

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