Rubber Prices Rebound: Is the Recovery Gaining Momentum? Market Awaits a Crucial Test in the Second Week of July
Medan, July 6, 2026 – The global rubber market opened the new trading week on a more optimistic note after experiencing a sharp correction at the end of June. Early Monday trading showed gains across major futures contracts, supported by firm raw material prices in producing countries, while market participants returned to buying following last week's steep decline in what appears to be a technical rebound.
As of 7:35 a.m. WIB, the SICOM TSR20 August contract was trading at 214.0 US cents/kg, up 2.4 cents, while the RSS3 September contract climbed to 16,955 yuan/ton, gaining 245 yuan. The advance extended the recovery that had already begun during Friday's trading session.
Weekly Review: Last Week Ended on a Stronger Note Than Expected
Throughout the past week, the rubber market remained under pressure amid concerns over weakening demand from China, both in the manufacturing sector and domestic consumption. The correction pushed SICOM TSR20 futures down to around 208–209 US cents/kg, the lowest level since early June.
However, sentiment improved toward the end of the week. Reuters reported that higher raw material prices in Thailand helped prevent a deeper decline in rubber futures. Prices for Thailand's benchmark RSS3 and block rubber remained firm, leaving processors with limited room to cut selling prices further. This encouraged investors and traders to return to the market, triggering a technical rebound.
Overall, although Japanese rubber futures still posted a slight weekly loss, Friday's rally significantly reduced the week's earlier declines.
Price Charts Indicate the Beginning of a Rebound
Based on SICOM TSR20 price movements throughout 2026, the market peaked above 234 US cents/kg in early June before undergoing a sharp correction toward 208–209 US cents/kg by the end of the month.
Recent trading has shown encouraging signs of recovery:
July 1: 209.4
July 2: 208.8
July 3: 211.6
July 6 (morning): 214.0
This sequence of higher prices suggests that selling pressure is gradually easing while buyers are steadily returning to the market.
Fundamental Factors Supporting the Market
Several recent developments are also providing positive support to the global rubber industry.
In Liberia, the government has reinforced its ban on exports of unprocessed natural rubber. The policy is intended to secure raw material supplies for domestic processing industries while promoting greater value-added production within the country. Over the medium term, such measures could tighten export supplies of raw rubber and provide additional support for global prices.
Meanwhile, Vietnam Rubber Group (VRG) announced that it has successfully sold approximately 10,000 tons of EUDR-compliant rubber, earning an additional US$120–250 per ton compared with conventional rubber. This indicates that international buyers are already willing to pay a premium for sustainably sourced rubber, even before the European Union Deforestation Regulation (EUDR) officially comes into force in 2027.
For Indonesia's rubber industry, this serves as a clear indication that sustainability and traceability will become increasingly important in maintaining export competitiveness.
Demand Remains the Key Challenge
Despite improving sentiment, risks remain.
Demand from China continues to be the market's primary concern. Manufacturing activity has yet to fully recover, leaving rubber consumption below expectations. Consequently, while prices have rebounded, much of the recent strength appears to be driven by technical buying and firm upstream costs rather than a significant improvement in underlying demand.
Technical Outlook (Disclaimer)
Disclaimer: The following technical assessment is based on price action and should not be considered investment advice.
With prices currently trading around 214 US cents/kg, the market appears to be emerging from oversold territory.
Key technical levels to watch this week include:
Support: 211–212 US cents/kg
Major support: 208–209 US cents/kg
First resistance: 216–218 US cents/kg
Next resistance: 220–223 US cents/kg
If prices can sustain trading above 214–216 US cents/kg, there is potential for further gains toward the 218–220 US cents/kg range. Conversely, a decline below 211 US cents/kg could weaken the current rebound and lead to another test of the 208–209 US cents/kg support zone.
Market Outlook for This Week
Supported by firm raw material prices, renewed technical buying, and positive policy developments among major producing countries, the global rubber market enters the second week of July with a noticeably stronger tone than it had at the end of June.
Nevertheless, the sustainability of the recovery will largely depend on demand conditions in China and the willingness of international buyers to absorb higher prices.
Conclusion: A technical rebound is clearly underway and momentum has improved. However, confirmation of a stronger bullish trend will require prices to hold consistently above the 214–216 US cents/kg range over the coming trading sessions.