NR consumption will have positive growth in August-October: ANRPC
Global natural rubber consumption is expected to enter into ‘positive territory’ in the period of August to October 2020 on stimulus policies and improving economic activities in China, the U.S., and other major consuming countries, said The Association of Natural Rubber Producing Countries ( ANRPC).
ANRPC released Natural Rubber Trends & Statistics, July 2020.
The association said the consumption will natural rubber is likely to increase 2.6% year-on-year growth during the three months from August to October 2020 after the 15.0% fall posted in the first half of the year, and 2.7% fall in July.
The Chinese economy expanded at an annualised 3.2% growth during the second quarter of 2020 (April to June) by beating the expectations after the 6.8% fall in the first quarter. By providing evidence of improving manufacturing activity, the manufacturing Purchasing Mangers’ Index (PMI) of China touched 51.1 in July. In the U.S., in a major initiative to revitalize the economy with expanded employment benefits ahead of the presidential elections to be held in November, a trillion-dollar coronavirus aid package is in the process of approval.
Prices of NR, both in the futures and physical markets, moved along a recovery path during July with the notable exception of latex market. Despite the growing concerns about a possible second wave of the pandemic and deteriorating US-China diplomatic relation, NR prices have the potential to continue moving along the marginal recovery path, in the short-term, supported by a host of factors which include the anticipated marginal improvement in the world consumption, factors constraining the world production and physical availability of NR , fall in the inventory held in the designated warehouses of the Shanghai Exchange, continued weakness expected in the U.S. dollar, and the support from the crude oil market.