Rubber Prices Extend Two-Day Decline, Market Tests the 210-Cent Psychological Level; Sideways-to-Weaker Trading Still Favored
Medan, July 30, 2026 – The global natural rubber market remains under pressure after prices closed lower for a second consecutive trading session. The correction has been driven by a combination of improving supply from major producing countries, stronger-than-expected Chinese natural rubber imports in June, weaker synthetic rubber prices, and still-soft demand from the tire manufacturing industry. As a result, market participants are adopting a cautious stance while waiting for fresh catalysts capable of changing the current market direction.
Based on market observations at 11:30 a.m. WIB (July 30), the SICOM TSR20 August contract was trading at 213.5 US cents/kg, unchanged from the previous close. Meanwhile, the RSS3 September contract on the Shanghai Futures Exchange (SHFE) declined 60 yuan to 16,360 yuan per metric ton, indicating that bearish sentiment continues to dominate Asian rubber markets.
Yesterday's Correction Continues to Weigh on Market Sentiment
On Wednesday (July 29), rubber prices recorded broad-based losses across the major Asian exchanges.
In Japan, Osaka rubber futures briefly fell to their lowest level in about one month. In China, the SHFE rubber contract dropped more than 2%, while butadiene rubber futures declined for a third consecutive session. Weakness in synthetic rubber prices also dragged natural rubber sentiment lower, as both materials compete as key raw materials for the tire industry.
The physical market in Thailand also softened. Prices for raw materials and export-grade RSS3 eased as favorable weather conditions supported tapping activities, resulting in higher raw material availability. The improvement in supply further reinforced bearish market expectations.
Rising Chinese Imports Signal a More Comfortable Supply Situation
One of the key developments closely monitored by the market is the significant increase in China's natural rubber imports during June 2026.
China imported approximately 483,200 metric tons of natural rubber in June, representing a 14.29% month-on-month increase and a 4.27% year-on-year increase. Import volumes also exceeded the average level recorded during the same period over the past five years.
The increase was mainly driven by higher imports of TSR and RSS grades as Southeast Asian producing countries entered a more stable tapping season. Although much of the imported material was absorbed by the domestic tire industry, the stronger import data nevertheless suggests that global supply conditions have become more comfortable, reducing concerns over raw material shortages.
Imports of natural latex and mixed rubber, however, remained relatively weak because downstream demand from the light manufacturing sector has yet to recover meaningfully. Overall, current supply conditions appear looser than they were several months ago.
Tire Demand Remains Under Pressure
On the demand side, the market continues to face headwinds from the global automotive sector.
Worldwide light vehicle sales during the first half of 2026 declined by approximately 3.9% year-on-year, limiting growth in new tire demand and, consequently, natural rubber consumption.
At the same time, many Chinese tire manufacturers are entering the traditional summer slowdown period, reducing the urgency to replenish raw material inventories. As a result, stronger supply has not been matched by equally strong consumption growth.
Thailand's Improving Supply Adds Further Pressure
Weather conditions in Thailand have been generally favorable in recent weeks, allowing tapping operations to proceed smoothly.
Higher latex production has led to lower raw material purchasing prices, putting additional downward pressure on rubber futures as the market becomes increasingly confident that immediate supply shortages are unlikely.
Nevertheless, weather remains an important variable. Any return of excessive rainfall across Southeast Asia could disrupt tapping operations, tighten supply, and provide renewed support for prices.
Technical Analysis: Market Enters a Consolidation Phase
Based on the year-to-date SICOM TSR20 price data provided:
Prices peaked at 234.5 cents/kg in early June.
A sharp correction followed, reaching 208.6 cents/kg by late June.
During July, prices recovered to around 219 cents/kg, but repeatedly failed to break above that resistance.
The market has since retreated to 213.5 cents/kg over the past two sessions.
Combined with the latest chart observations, price momentum appears to have weakened after several unsuccessful attempts to break above the 218–220 cents/kg resistance zone. Trading volume and open interest have yet to show convincing signs of fresh buying interest entering the market, suggesting that any sustained recovery will require stronger confirmation.
Today's Technical Outlook (Technical Analysis – Not a Guarantee)
Disclaimer: Technical analysis is based solely on historical price behavior and should not be interpreted as a guarantee of future market performance.
Unless significant new fundamental developments emerge, SICOM TSR20 is expected to trade sideways with a slightly bearish bias throughout today's session.
Estimated trading range:
Primary support: 212–213 cents/kg
Secondary support: 210–211 cents/kg
Nearest resistance: 215–216 cents/kg
Major resistance: 218–220 cents/kg
If the market successfully holds above 213 cents/kg, prices could continue consolidating within a relatively narrow range while awaiting new market drivers. However, should selling pressure intensify and this support level break, prices could retest the important 210 cents/kg psychological support.
Conversely, a meaningful improvement in market sentiment would likely require a decisive move above 216–218 cents/kg, supported by stronger trading volume, potentially opening the way toward the 220 cents/kg area.
Short-Term Outlook
Overall, current market fundamentals continue to reflect a supply environment that is expanding faster than demand, leaving rubber prices vulnerable to further weakness in the near term.
Nevertheless, downside risks may be limited. Historically, tire manufacturers begin increasing raw material purchases during the fourth quarter in preparation for year-end production. In addition, weather-related uncertainties across Southeast Asia remain an important factor that could quickly alter the global supply balance.
For today's trading session, investors are therefore expected to remain cautious, with a sideways-to-slightly weaker trading pattern representing the most likely scenario unless new fundamental catalysts emerge to improve market sentiment.