Rubber prices saw a 28 percent decline in 2022 but 2023 has been a different story. The year has started on a slightly positive note with international rubber prices trading at near one-month highs.
The decline in the US dollar index also has been supportive. There is a report from the international rubber consortium, which says that “The production from Thailand, Malaysia and Indonesia, which are the other major producers of rubber, we have seen the rubber production decline as compared to the previous year that has been supportive”.
The reasons given are leaf disease that some of these plantations are looking at, adverse weather, the rise in climate temperatures that does not augur well for tapping season in such and also low fertilizer input because of the higher prices also has led to a bit of a yield decline.
For the Indian markets as well, this is a high peak tapping season that continues until the month of February. But until now because the prices were declining, rubber didn't see so much of a buyer coming from stockists, which also seems to be happening right now because good quality rubber is available at a cheaper price. So demand seems to be coming back into the market, also supporting the prices.
Source: CNBC