SICOM TSR20 Holds Above 230 US Cents/kg as Market Targets the 235–240 Cent Range Amid Supply and Macro Headwinds

Medan, June 17, 2026 – The global natural rubber market continued to demonstrate resilience after the July 2026 SICOM TSR20 contract successfully held above the key psychological level of 230 US cents/kg. Following the previous session's close at 231.6 US cents/kg, the contract was trading at 231.5 US cents/kg as of 07:45 WIB (Western Indonesia Time), down just 0.1 US cent.

The modest decline suggests that selling pressure remains limited and is being driven primarily by technical factors rather than any significant deterioration in the underlying fundamentals of the global natural rubber market.

At the same time, the most actively traded September RSS3 contract on the Shanghai Futures Exchange (SHFE) gained 240 yuan to 18,080 yuan per tonne, reinforcing the view that overall market sentiment toward natural rubber remains positive despite expectations of seasonally higher production from major producing countries.

Morning Pullback Driven by Profit-Taking After a Strong Rally

The slight weakness observed during Wednesday morning's session is widely viewed as a normal correction following a strong upward move in recent days.

Over the previous six trading sessions, SICOM TSR20 climbed from a low of 222.6 US cents/kg on June 10 to 231.6 US cents/kg on June 16. The nearly 9-cent gain in less than a week prompted some investors to lock in profits as prices approached an important resistance zone.

External factors also contributed to the cautious tone.

Commodity markets broadly continued to react to lower global energy prices as geopolitical tensions in the Middle East eased. Market reports indicate that concerns over potential disruptions to oil supplies from the Gulf region have diminished amid growing optimism for diplomatic progress between the United States and Iran. As a result, crude oil prices have corrected lower, reducing the geopolitical risk premium across commodity markets.

Unlike energy and petrochemical commodities, however, natural rubber continues to benefit from relatively stronger market fundamentals, preventing selling pressure from developing into a deeper correction.

Synthetic Rubber Weakens, but Natural Rubber Maintains Its Advantage

Market attention has also turned to declining prices for styrene-butadiene rubber (SBR) and butadiene rubber (BR) in China.

From early May through mid-June, prices for both SBR and BR reportedly declined by approximately 17%, driven by weaker butadiene feedstock prices, improving supply conditions, and fading macroeconomic optimism.

As a result, the price gap between natural rubber and synthetic rubber has widened to nearly 4,000 yuan per tonne.

In theory, a wider price differential may encourage tire manufacturers to increase the proportion of synthetic rubber in their formulations. However, the impact on natural rubber demand is expected to remain limited, as most radial tires—particularly those used for trucks and commercial vehicles—still require a high proportion of natural rubber to meet performance standards.

Consequently, despite weakness in the synthetic rubber market, pressure on TSR20 prices has remained relatively modest.

Declining Qingdao Inventories Continue to Support Prices

One of the most closely watched indicators remains inventory levels at Qingdao, China's largest natural rubber trading hub.

The latest data show that natural rubber inventories have fallen to approximately 681,600 tonnes, a decline of more than 15,000 tonnes from the previous week.

The continued drawdown suggests that underlying demand remains strong enough to absorb incoming supplies.

Meanwhile, although the tapping season has progressed normally across Thailand, Indonesia, Vietnam, and Malaysia, persistent morning rainfall continues to limit production growth in several key producing regions.

As a result, the market has yet to see a significant increase in supply capable of exerting substantial downward pressure on prices.

Technically, 230 US Cents/kg Has Become a Key Support Level

Year-to-date price performance indicates that the primary trend for SICOM TSR20 remains firmly upward.

After starting the year at around 181.7 US cents/kg, prices have gained more than 27% and have repeatedly tested the 230 US cents/kg level.

From a technical perspective, 230 US cents/kg has now shifted from being a resistance level to an important support zone.

If prices remain above this level through the end of the week, the probability of retesting the June 2 high of 234.5 US cents/kg will increase.

Key technical levels currently being monitored include:

Support

• First support: 230 US cents/kg

• Second support: 228 US cents/kg

• Major support: 225 US cents/kg

Resistance

• 234.5 US cents/kg

• 236 US cents/kg

• 240 US cents/kg

Market Could Test the 235–240 US Cents/kg Range This Week

Based on the current combination of technical and fundamental factors, the market still has the potential to test the 235–240 US cents/kg range during the week.

Technically, the strong rebound from the 222–225 US cents/kg area demonstrates that buying interest continues to emerge whenever prices correct.

Fundamentally, the absence of a significant increase in global supply, the continued decline in Qingdao inventories, and persistently high raw material prices in producing countries have helped maintain a relatively tight market balance.

In addition, tire factory utilization rates in China remain at healthy levels, while commercial vehicle sales and logistics activity continue to improve compared with last year.

If prices successfully break above 234.5 US cents/kg, the next upside targets could extend toward 238–240 US cents/kg.

Conversely, failure to overcome this resistance may lead to another period of healthy consolidation within the 228–232 US cents/kg range before the market establishes its next direction.

Outlook

Overall, SICOM TSR20's performance on the morning of June 17 suggests that the market remains in a bullish consolidation phase. The modest pullback appears to be driven mainly by profit-taking and weaker sentiment across energy markets rather than by any deterioration in natural rubber fundamentals.

As long as prices remain above 230 US cents/kg and inventories at Asia's major trading hubs continue to decline, the market retains a solid opportunity to retest the 234.5–240 US cents/kg range during the week. In short, the current market structure continues to reflect a healthy upward trend rather than the beginning of a broader bearish reversal.