Rubber prices soared to a high in more than 3 years as glove demand increased due to the Covid-19 crisis and booming industrial use in China, while supply crises allegedly erupted with manufacturers scrambling to replenish stocks.
In addition, production across Southeast Asia which accounts for more than two-thirds of natural rubber supply has been hit by a shortage of manpower driven by coronavirus transmission as well as floods and bad weather in Thailand and Vietnam.
According to Shinichi Kato, president of the Shinichi Kato Office rubber traders, speculation regarding rising tensions between the authorities and anti-government protesters in Thailand could cause supply disruptions as well as trigger concerns about rubber supply.
In addition, rubber futures on the Japanese Osaka Exchange have reached their highest level since February 2017 yesterday, having jumped more than 40% since the end of September. While the most active rubber contracts on the Shanghai futures exchange were also at their highest level for a period of 3 years and increased by 26% this year. In addition, markets in Singapore and Thailand also saw steep demonstrations.
This is because the demand for global rubber gloves has increased by more than 20% this year to 360 billion pieces due to the spread of the coronavirus pandemic epidemic and is the largest annual surge recorded.
Based on a statement submitted by senior analyst of the Economic Intelligence Center, Kanyarat Kanjanavisut, the demand for rubber gloves is expected to continue to increase as long as there is no vaccine for Covid-19. For the remaining 2 months of the year, demand is still soaring.
In addition, Malaysia, which is a rubber glove manufacturing center located at Top Glove, saw exports of gloves increase by 48% and predicted global global glove shortages would increase until the first quarter of 2022.
However, there are concerns that existing rubber production will not be able to meet the growing demand of foreign markets.
