Kuala lumpur: The Malaysian rubber market is expected to trade cautiously next week, moving sideways with a slightly upward bias, said industry expert Denis Low. He highlighted that the volatility of the exchange rate will significantly affect rubber prices, as its root tends to lie in geopolitics rather than the real economy.

According to BERNAMA News Agency, the Thai Meteorological Department (TMD) had issued a storm warning for southern Thailand with heavy rains anticipated. TMD advised the public to remain cautious amid stormy conditions in Thailand. In Malaysia, the Meteorological Department has forecast thunderstorms, heavy rain, and strong winds across Peninsular Malaysia.

Meanwhile, the Malaysian Rubber Glove Manufacturers Association (MARGMA) noted that new US-China trade war tensions announced today are likely to negatively impact the rubber market next week. However, it also pointed out that a positive outlook for the global automotive industry and an expected rise in China production may boost demand and drive prices upward.

MARGMA indicated that this upward momentum, combined with weather conditions in glove-producing nations that suppress supply, is expected to drive prices higher. It projected that trading might experience a sideways performance next week. Additionally, rubber prices will be influenced by regional rubber futures, fluctuations in benchmark crude oil prices, and the movement of the ringgit against the US dollar.

On a Friday-to-Friday basis, the Malaysian Rubber Board’s reference price for Standard Malaysian Rubber 20 (SMR 20) saw a decline by three sen during the week to 736.7 sen per kilogram, while latex-in-bulk slipped five sen to 569 sen per kilogram.