KUALA LUMPUR: The local rubber market is anticipated to trade within a limited range, with a tendency to edge higher, primarily due to a tight supply situation arising from ongoing weather disruptions, according to industry expert Denis Low. Low highlighted that the persistent rainfall is likely to impede rubber tapping and collection activities, potentially leading to a shortage.
According to BERNAMA News Agency, Low pointed out that the constrained availability due to supply issues may bolster the upward momentum of natural rubber prices. He also remarked on the geopolitical landscape, noting that the return of Donald Trump to the White House has caused concern among Chinese exporters. Trump’s campaign proposal to impose additional tariffs of 60 percent or more on Chinese goods sold to the US might motivate other buyers to increase their rubber imports to fortify their exports against potential future tariffs.
Low further observed that geopolitical risks remain a significant source of uncertainty for the
global economy, potentially affecting oil and gas price volatility. Despite the ongoing de-dollarisation, the US dollar is expected to remain within a range, maintaining an elevated status compared to other currencies.
The Malaysian Rubber Glove Manufacturers Association (MARGMA) commented that the rubber market is likely to remain volatile, reflecting the performance of regional rubber futures markets. The association added that factors such as improving Chinese demand, geopolitical developments, and global economic indicators could support a price uptrend and influence market direction in the coming week.
MARGMA noted that severe flood conditions, especially in Thailand and parts of Malaysia, are anticipated to disrupt natural rubber production. This disruption, combined with improving Chinese economic data and potential fiscal stimulus measures, may further enhance demand for natural rubber.
On a weekly basis, the Malaysian Rubber Board’s reference price for Standard Malaysian Rubber 20 (SMR 20) saw an
increase of 34.5 sen to 879 sen per kilogramme. In contrast, latex-in-bulk decreased by eight sen to 673.5 sen per kilogramme. As of 5 pm yesterday, the price of SMR 20 was recorded at 875.5 sen per kilogramme, while latex-in-bulk was at 672 sen per kilogramme.