Malaysian Rubber Market Likely To Trade Range-bound Next Week

By Fatin Umairah Abdul Hamid

KUALA LUMPUR, Aug 10 (Bernama) -- The local rubber market is set to trade range-bound next week, with potential volatility arising from any supply-side disruptions caused by weather, said industry expert Denis Low.

He noted that the Northern rubber-producing region is beginning to experience the La Nina effect, and warnings for potential flash floods and landslides have been issued.

“If the heavy rain persists in the weeks ahead, it will further hamper rubber production, and the low latex yield will cause disruptions in the supply of rubber,” he told Bernama.

The Thai Meteorological Department has issued a warning for heavy to very heavy rains, thundershowers, and flash floods until August 13.

This alert affects various regions in Thailand, including major rubber-growing areas.

Meanwhile, the Malaysian Rubber Glove Manufacturers Association (MARGMA) expects the rubber market to ease slightly next week amid mixed signals from regional rubber futures markets.

In a statement, the association said that while tight natural rubber supply has supported prices, concerns about a potential recession in the United States and a stronger ringgit have exerted downward pressure.

The local rubber market for the week just ended traded mostly lower amid demand concerns and weaker regional futures, although it showed some improvement due to a recovery in crude oil prices and a weaker ringgit.

On a Friday-to-Friday basis, the Malaysian Rubber Board’s (MRB) reference price for Standard Malaysian Rubber 20 (SMR 20) decreased by half a sen to 775 sen per kilogramme (kg) from 775.5 sen per kg last week.

Meanwhile, latex-in-bulk declined by three sen to 630.5 sen per kg from 633.5 sen previously.

At 5 pm, the MRB reference price for physical SMR 20 stood at 778.5 sen per kg, while latex-in-bulk was at 630.5 sen per kg.

-- BERNAMA