Rubber Prices Move Sideways as Technical Rebound Emerges, Market Awaits Fresh Catalysts from Global Fundamentals and Weather Conditions
Medan, July 14, 2026 – The global natural rubber market has entered a consolidation phase after experiencing a sharp correction at the end of June. After briefly falling to around 208 US cents/kg on the SICOM TSR20 contract, prices have recently traded within a relatively narrow range of 214–218 US cents/kg, awaiting fresh catalysts from both the demand and supply sides of the market.
Market monitoring at 09:15 WIB on Tuesday morning showed signs of a modest technical rebound. The active SICOM-TSR20 SGX August 2026 contract was trading at 215.3 US cents/kg, up 0.8 cent from the previous close, while the active RSS3 SHFE September 2026 contract stood at 16,920 yuan/tonne, unchanged from the previous session.
The limited gains suggest that market participants remain cautious after several days of sideways trading and declining volatility.
Yesterday's Correction Was Mainly Profit-Taking and Consolidation
Monday's trading session (July 13) indicated that the market remained in a consolidation phase following the rally seen in early July. The August SICOM contract closed around 214.5 US cents/kg, posting a slight decline from the previous session.
The correction was largely attributed to short-term profit-taking after prices had recovered from late-June lows near 208 US cents/kg to approximately 218 US cents/kg last week.
Historically, current prices remain relatively high compared with the beginning of the year. Data show that SICOM TSR20 prices were still trading around 181–185 US cents/kg in early January 2026, before reaching a peak of 231.6 US cents/kg in mid-May. Therefore, despite the correction seen during June and early July, global rubber prices remain significantly above levels recorded at the start of the year.
Morning Rebound Supported by Oil Prices and Raw Material Strength
Positive sentiment this morning was supported by rising crude oil prices following renewed geopolitical tensions in the Middle East and concerns over energy shipments through the Strait of Hormuz.
Higher oil prices generally support natural rubber prices because synthetic rubber, which is derived from petroleum products, becomes more expensive and therefore improves the competitiveness of natural rubber.
In addition, raw material prices in Thailand have resumed their upward trend. Thai latex prices increased to 79.30 baht/kg, while cup lump prices remained elevated at approximately 67.50 baht/kg, indicating that upstream production costs continue to provide support to global rubber prices.
Rainfall disruptions in parts of Thailand, one of the world's largest rubber producers, have also continued to limit tapping activities, preventing any significant increase in short-term supply.
Chinese Tyre Demand Remains the Main Pillar of Support
On the demand side, conditions remain relatively supportive, particularly in China, the world's largest rubber consumer.
China's tyre exports increased by 4.8% year-on-year in June 2026, indicating that tyre manufacturing activity remains resilient despite the seasonal slowdown typically seen during the middle of the year.
This robust physical demand is one of the key reasons why rubber prices have not experienced a deeper decline.
However, the market is also monitoring temporary production slowdowns and maintenance shutdowns at several tyre factories, which may limit upside potential in the near term.
Malaysian Production Rises but Inventories Continue to Decline
According to the latest figures released by the Department of Statistics Malaysia (DOSM), Malaysia's natural rubber production reached 20,198 tonnes in May 2026, representing an increase of 9.1% month-on-month from April.
Nevertheless, production remained 16.7% lower compared with May 2025, suggesting that the recovery in global supply remains gradual.
Interestingly, Malaysian natural rubber inventories declined by 6.2% to 122,658 tonnes, indicating that export demand and domestic consumption remain relatively healthy.
Meanwhile, Malaysian natural rubber exports fell by 23.1% month-on-month, with China continuing to be the largest export destination.
Falling Chinese Inventories Continue to Support the Market
Recent data also showed that natural rubber inventories at Qingdao ports declined by approximately 15,896 tonnes, while China's broader social inventories fell by around 15,696 tonnes.
These inventory reductions have become an important factor preventing a more substantial correction in global rubber prices over recent weeks.
In other words, although supply is gradually increasing as the peak harvesting season progresses, demand has so far remained sufficient to absorb the additional output.
EUDR Amendment Does Not Change Indonesia's Obligations
From the regulatory perspective, the European Commission recently adopted a Delegated Act amending Annex I of the EU Deforestation Regulation (EUDR).
The amendment removes leather products from the scope of the regulation. However, this decision does not change the primary obligations for Indonesia's rubber industry, as natural rubber remains one of the key commodities still covered under the EUDR requirements for entry into the European market.
As a result, Indonesian rubber producers and exporters must continue preparing traceability systems, plantation geolocation data, and due diligence documentation in compliance with EU regulations.
Market Outlook for Today
From a technical perspective, this morning's rebound indicates buying interest emerging near support levels after prices repeatedly failed to break below the psychological level of 214 US cents/kg.
As long as prices remain above the 214–215 US cents/kg area, the market may attempt to retest resistance levels near:
216.5 US cents/kg
217.8 US cents/kg
219.0 US cents/kg
Conversely, should selling pressure re-emerge and prices fall below 214 US cents/kg, the market may revisit support levels around:
213.0 US cents/kg
211.5 US cents/kg
210.0 US cents/kg
Taking current fundamentals into consideration, the most likely scenario for today's trading session remains sideways with a slightly bullish bias, with prices expected to fluctuate within the 214.0–218.0 US cents/kg range.
Disclaimer: The technical analysis presented above represents an interpretation based on historical price data, chart patterns, and current market conditions. Actual market movements may be influenced by changes in sentiment, weather conditions in producing countries, geopolitical developments, exchange rate movements, and other fundamental factors. Therefore, this analysis should not be considered investment advice or a guarantee of future performance.