Rubber Prices At Two-Month Low On Demand Concerns

(MENAFN- Yolo Wire) Prices for natural %Rubber have fallen to their lowest level in two months, pushed down by rising concerns about international demand, particularly in China.

The price of rubber is currently trading below $2 U.S. per kilogram, its lowest level since May of this year.

The decline is a reversal from earlier this year when rubber prices spiked on supply concerns that were prompted by a drought in major rubber-producing nations Vietnam and Thailand.

However, earlier concerns about supply have now been replaced with worries over waning demand for rubber, pushing prices downward.

Motor vehicle tires account for more than 70% of rubber demand, and China is both the world's largest importer of rubber and the largest automotive market.

Demand within China has steadily weakened as motor vehicle sales slump, particularly sales of electric vehicles.

China’s economy continues to struggle coming out of the Covid-19 pandemic and amid a debt crisis in the country’s property sector.

Analysts say that rubber prices are likely to remain depressed in the near-term until global demand rises and China’s economy improves.

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