A summary of the natural rubber issues

Euronews published a short and useful summary of why the global rubber market was expected to see shortages, and it is the piece we point people to when they want the problem in one page rather than in a trade report.

The mechanics are simple enough. Supply is concentrated, slow to expand and exposed to weather and disease. Demand grows with vehicle production, industrial output and construction. When the two lines diverge, price volatility follows, and buyers of natural rubber start to see the kind of swings the coffee and cacao markets have already lived through.

The downstream effect is what interests our customers. A compound that cannot be secured on a reliable specification, at a predictable price, from a source that can be proven deforestation-free, becomes an engineering risk rather than a procurement line.