Rubber Futures at 10-Month Highs

Rubber futures extended their rally past 205 US cents per kilogram, hitting levels last seen in December 2024, supported by seasonal supply tightness and rising demand expectations. Buyers brace for the February–May low-production season in the key producing region of Southeast Asia, before harvesting typically ramps into late summer. Rubber trees produce less latex during the annual ‘wintering’ season, a period when tapping is minimal due to cooler or drier conditions. Moreover, increased rainfall in major producers like Thailand and Indonesia is reportedly reducing raw-material flows, tightening supply further. Meanwhile, the Association of Natural Rubber Producing Countries (ANRPC) said recently that global demand is set to exceed production for the sixth consecutive year in 2026, driven by stronger automotive-sector growth globally. Global output is forecast to rise 2.4% to 15.2 million tons, while demand is expected to climb 1.7% to 15.6 million tons.

Rubber futures traded around 193 US cents per kilogram, close to the highest since April 2025, supported by seasonal supply constraints and expectations of stronger demand. Most major rubber-producing regions in Southeast Asia 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. In the meantime, the Association of Natural Rubber Producing Countries (ANRPC) said on February 19 that global demand for natural rubber is projected to exceed production for a sixth straight year in 2026, driven by stronger automotive-sector growth in both emerging and advanced economies. Global output is projected to increase by 2.4% in 2026, reaching 15.2 million tons while demand is expected to grow by 1.7%, climbing to 15.6 million tons.

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.