Rubber Futures Stabilize

Rubber futures traded slightly above 191 US cents per kilogram, nearing the highest since April 2025, partly supported by firmer oil prices that make synthetic alternatives less attractive. In the meantime, supply concerns persisted. Major rubber-producing regions in Southeast Asia, excluding Thailand, have largely completed rubber tapping as crops enter the off-season, reducing the availability of raw materials. Rubber trees typically see a brief tapping period in late January, followed by reduced output from February through May, before production picks up again during the peak harvest season, which runs until September. Meanwhile, rubber demand is expected to soften this week and the next, with Chinese tyre manufacturers temporarily closing factories for the Lunar New Year.

Rubber futures steadied at around 188 US cents per kilogram, as market participants balanced weakening demand signals against seasonal supply constraints. Demand concerns emerged after tyre production in China, the world’s largest consumer, slowed ahead of the Lunar New Year holiday. Pre-holiday restocking in China had lifted demand earlier, but rising inventories at Qingdao port suggested that most buying is now done. On the supply side, most major rubber-producing regions in Southeast Asia, with the exception of Thailand, have largely concluded rubber tapping as crops move into the off-season. Rubber trees typically see a brief tapping period in late January, followed by reduced output from February through May, before production picks up again during the peak harvest season, which runs until September.

Rubber futures dropped to around 185 US cents per kilogram, retreating from a nine-month high, partly due to sliding oil prices, which make synthetic alternatives more attractive. Adding to bearish pressure, traders were also likely booking profits after January’s strong run-up. While anticipated pre-Lunar New Year restocking in China had initially boosted demand expectations, rising inventories at Qingdao port and the fact that most restocking is already complete have limited further upside. Capping some losses, supply concerns grew as the tapping season in major Asian producers, including Thailand and Vietnam, came to an end. Rubber trees typically undergo a short tapping period in late January, followed by lower output from February through May, before entering a peak harvest season that lasts until September.