KUALA LUMPUR, Dec 14 (Bernama) -- The local rubber market is expected to trend higher next week due to low latex yield and tight rubber supply situations, said industry expert Denis Low.
He said the incessant rainfall in the rubber-producing regions is causing a generally subdued production of bulk latex, causing a very short supply situation.
“Thailand is preparing for increased rainfall from now to end-December with a decrease in temperature for the morning from cool to cold with strong winds,” he told Bernama.
Meanwhile, the Malaysian Rubber Glove Manufacturers Association (MARGMA) said other than potential supply disruptions, a weakening ringgit and supportive crude oil prices could provide upside.
Market sentiment is also set to get a boost from the launch of the first Malaysian Sustainable Natural Rubber (MSNR) initiative on rubber exports compliant to the European Union (EU) by Plantation and Commodities Minister Datuk Seri Johari Abdul Ghani recently.
It said this initiative reflects Malaysia’s commitment to complying with international sustainability standards ahead of the EU Deforestation Regulation (EUDR) implementation.
“However, weaker global economic conditions and subdued demand from key consuming sectors may limit significant price gains,” it added.
On a Friday-to-Friday basis, the Malaysian Rubber Board’s reference price for Standard Malaysian Rubber 20 (SMR 20) declined by 44.5 sen to 889 sen per kilogramme (kg), while latex-in-bulk rose 18 sen to 706.5 sen per kg.
At 5 pm yesterday, the price of SMR 20 stood at 898.50 sen per kg, while latex in bulk was at 712.50 sen per kg.
-- BERNAMA
