Rubber latex prices are high amid concerns about tight supply. Farmers are excited about increasing profits after a long struggle with low prices.
THE PRICES OF RUBBER LATEX ARE INCREASING
Ms. Dinh Thi Huyen, a rubber farmer in Thanh Tuyen commune (Dau Tieng district, Binh Duong province), said that the price of rubber latex has nearly doubled compared to the same period last year. Farmers are very happy and hope that the price will remain at a high level.
Rubber latex prices have increased amid concerns about tight supply.
Ms. Nguyen Thi Kim Loan, a trader in Thanh Tuyen commune, said that the latex price last year was low, so many people did not even harvest. Because after deducting expenses, there was no profit.
Mr. Nguyen Thuan, who lives in La Ngau commune (Tanh Linh district, Binh Thuan province) and has more than 30 hectares of rubber, said that in 2023, the highest price was only 32–33 million VND per ton. Now, the price has increased to 37–38 million VND/ton. High prices not only help the farmers have a better income but also create more jobs for people in the countryside.
High prices of rubber latex have created more jobs for people in the countryside.
RUBBER LATEX PRICE HAS INCREASED DUE TO SUPPLY SHORTAGE
Thailand, Indonesia, and Vietnam are the three countries that contribute 57.5% of the total natural rubber production in the world. According to statistics, rubber production in the first quarter of 2024 decreased by 18.3% for Thailand, by 15.2% for Indonesia, and by 2.7% for Vietnam compared to the same period last year. Global rubber production also fell by 8.5% in the first quarter of this year.
The Import and Export Department (Ministry of Industry and Trade) said that, since the beginning of June 2024, rubber prices at Asian exchanges have increased sharply compared to the end of the previous month. Prices have increased amid concerns about tight supply. Because the low supply of rubber on the market is unusual at this time.
Normally, the amount of fresh latex increases again in the second half of May. This is the time when farmers start harvesting again after a period of stopping latex harvests during the foliage change season. However, the amount of rubber brought to the market fell sharply at a time when most market participants expected supply to increase.
The unexpectedly low volume of goods on the market raises concerns about the availability of raw materials, especially for processing companies. This situation has caused the price of fresh rubber latex to increase sharply in many localities.
Rubber latex harvest in Binh Duong.
In addition, rubber supplies may continue to be in short supply in 2024–2025. It is expected that the global market will likely be in deficit of about 600,000–800,000 tons per year.
Rubber harvesting performance has declined in recent years due to pandemics and extreme weather. The area of rubber planting in Thailand and Indonesia has continuously decreased due to the pests on rubber trees and the trend of converting to other industrial crops with higher economic efficiency.
In the first five months of 2024, the average export price of rubber reached 1,502 USD/ton, up 8.6% over the same period in 2023.