Rubber Remains Range-Bound

Rubber futures rose to around 260 US cents per kilogram, revisiting levels not seen since March 2013, amid ongoing weather supply disruptions in major producing countries. In Thailand and parts of China, rainfall continued to disrupt rubber tapping, keeping latex and other raw material prices elevated. Low all-steel tyre inventories and continued destocking in Qingdao, a major trading and storage hub, added to the upward pressure. Higher oil prices provided additional support by raising the cost of synthetic rubber. Meanwhile, the development of a “strong” El Niño continued to pose risks to future production. Demand, however, remained subdued as Chinese tyre manufacturers entered the holiday period. Weak profitability had already led some manufacturers to halt operations and cut rubber purchases.

Rubber futures traded around 250 US cents per kilogram, slightly retreating from their highest level since early 2013, as profit-taking and weak tyre demand weighed on prices. Chinese tyre manufacturers extended production halts amid persistent losses, reducing short-term demand for natural rubber as factories cut tyre output ahead of the holidays. Nevertheless, losses were limited by supply concerns, with Thailand’s natural rubber exports down 10% year-on-year to 1.62 million tonnes in the first eight months of 2026. Supply recovery outside China has also remained sluggish after prolonged rainfall disrupted major producing areas, while warehouse receipts for domestic rubber futures continued to decline and remained below year-ago levels. Rising oil prices also offered some support as they lifted synthetic rubber costs and boosted demand for natural rubber as a substitute.

Rubber futures held above 250 US cents per kilogram, near their highest level since early 2013, driven by firm raw material prices and persistent supply concerns. Supply worries intensified after congestion at Abidjan port disrupted shipments from key producer Ivory Coast. In Thailand, rubber tapping remained disrupted by rainfall, keeping raw material prices elevated, while the country's meteorological agency warned of severe rains and flash floods. The impact of El Niño also raised concerns over production, adding to supply risks. Signs of tighter availability were also evident in China, where natural rubber imports fell 6.7% year-on-year to 486,000 tonnes in August, the lowest level for the month in six years, while rubber inventories at warehouses in Qingdao, a major trading and storage hub, declined by 17,400 tonnes in the week of September 18.