Entering December, with the continuous optimization of domestic epidemic prevention policies and the improvement of macro market sentiment, the previously sluggish natural rubber market has rebounded, and the futures price has started a slow rebound. The main contract of Shanghai rubber closed at a stable level of 13000 yuan/ton on December 8th.

The main driving force behind the slow rise in natural rubber prices currently comes from the macro level.

On the one hand, with the decline of high overseas inflation, the pace of interest rate hikes by central banks such as the Federal Reserve has slowed down, the People's Bank of China has lowered the reserve requirements for financial institutions, the US dollar index has fallen, the Chinese yuan exchange rate has strengthened, and the commodity market has rebounded.

On the other hand, the optimization and adjustment of domestic epidemic prevention policies have also brought benefits to the market. Li Qing, an analyst at CITIC Futures Energy, stated that based on the continuous optimization of recent epidemic prevention policies, the market is beginning to trade expectations of future demand recovery. At the same time, due to the overall poor performance of rubber terminal demand, there is even greater room for improvement in domestic demand in the future rubber market against the backdrop of macroeconomic expectations.

The current domestic natural rubber inventory shows a reality of low inventory levels in various sub categories. The expectation of demand repair for low inventory often leads to higher price elasticity. Therefore, the improvement of macro expectations and the reality of low inventory have driven the slow rise in rubber prices in recent times.

On December 6, 2022, the main rubber RU closed at 12935 yuan/ton (+75), with a mixed rubber quotation of 10950 yuan/ton (+25) and a main contract basis of -635 yuan/ton (-75); The top 20 main players have long positions of 79573 (+6501), short positions of 114927 (+7541), and net short positions of 35354 (+1040). The closing price of NR main force is 9835 yuan/ton (+40), the price of Thai standard rubber in Qingdao Free Trade Zone is 1410 US dollars/ton (+10), and the price of Malaysian standard rubber is 1400 US dollars/ton (+10).

Raw materials: Raw film 44 baht/kg (0), cup adhesive 39.05 baht/kg (+0.15), glue 44.1 baht/kg (0), cigarette film 46.9 baht/kg (+0.1).

As of December 2nd, the total inventory of the exchange is 155285 (+6700), and the warehouse receipts of the exchange are 125220 (+4790).

As of December 1st, the operating rate of all steel tires in China was 60.53% (-2.36%), and the operating rate of semi steel tires in China was 64.19% (-3.49%).

As of last weekend, the inventory at Qingdao Port in China continued to show a slight upward trend, with a slight decline in both inbound and outbound shipments last week. However, overall, due to weak demand, inventory continued to accumulate. At present, due to the expected improvement in demand for rubber and the relatively low short-term supply pressure in China, the supply-demand contradiction is not prominent,The absolute price is in a low range and shows a certain trend of recoveryFutures prices continue to fluctuate strongly. With the improvement of the domestic market atmosphere, it is expected that rubber prices will continue to fluctuate strongly, but the driving force for further upward movement still needs to see substantial improvement in demand. It is expected that the short-term unilateral fluctuation of rubber prices will follow the surrounding market atmosphere, and the price difference between RU and NR is expected to continue to expand based on the difference in supply pressure.