2016 rubber annual report: the bottom of rubber production and marketing game is still not seen

From the perspective of rubber fundamentals, rubber will still undergo a process of profit redistribution and readjustment next year. At present, we know that the downstream tires of rubber, automobiles and intermediate import traders are in the environment of industrial losses and high inventory, so the main contradiction is still whether the upstream will reduce production. At present, the overall supply of rubber is still surplus, and the industry profits are mainly concentrated in the upstream. Due to the long planting time of rubber, it takes a process for rubber farmers to go from making money to making no profit to losing money, which may lead to a large area of stop cutting. In addition, the living standards of the major rubber producing countries are low, and even if the rubber price falls, the willingness to abandon cutting is not strong. Therefore, at present, there is no obvious reduction or expected reduction in production. In this context, it is relatively difficult to stop the decline of Shanghai Rubber.

For the risk points that need to be paid attention to in the coming year, we believe that one is the planting cost and import cost of rubber farmers. At present, the rubber price is relatively low. If the bottom line of rubber farmers is reached in the next city, the phenomenon of tree cutting may occur, and the pattern of rubber supply and demand may be significantly changed at that time; In addition, in terms of weather factors, the subsequent impact of El Ni ñ o may break out in the second and third quarters of next year, and the same period is also the time for rubber to speculate on the weather in previous years. If this time is combined with some protective policies of rubber producing countries or domestic, there may be a temporary boost to rubber prices; Finally, the impact of policy factors cannot be ignored. In 2015, there was no other collection and storage policy except for the collection and storage of raw materials in Thailand at the beginning of the year. Whether there will be collection and storage in 2016 and how large the collection and storage scale may affect rubber. However, according to our statistics of collection and storage policies in previous years, it is expected that the scale of collection and storage in 2016 will not be too large, even if there is one. After a short period of collection and storage, it is difficult to have an impact on the overall pattern of rubber.

In general, it is expected that the price of natural rubber will remain at the bottom in 2016. From the end of the year to the beginning of the year, under the background of increasing production in Thailand, it is expected that the rubber price will continue to decline, or will reach around the cost area of 9000-10000 yuan/ton. After the Spring Festival, if there are weather factors or the policy of the rubber producing country, and the foreign cost can rise to 60 baht/kg, the corresponding domestic rubber price may rise to 14000-15000 yuan/ton. In the second half of the year, the main focus is on the process of futures de-stocking, if the inventory is still high, In the second half of the year, it may return to around 11000 yuan/ton.