In the landscape of natural rubber (NR) production, the Association of Natural Rubber Producing Countries (ANRPC) foresees a decrease in global demand for the year 2023 compared to the preceding year. The latest monthly report, encompassing market data up to November 2023, indicates an expected consumption of 15.438 million tonnes for the previous year.

Based in Kuala Lumpur, ANRPC attributes the subdued global outlook for NR demand primarily to the underperformance of non-ANRPC members. This trend is linked, in part, to protracted geopolitical tensions, including conflicts such as those between Ukraine and Russia, as well as the Israel-Palestine conflict. The demand from non-ANRPC members is anticipated to undergo a year-on-year decrease of 11.1% in 2023, reaching 4.113 million tonnes. Consequently, the proportion of global NR demand from non-ANRPC members is expected to drop below 30%, marking the lowest share to date.

Beyond geopolitical factors, the heightened borrowing costs resulting from rate hikes have also contributed to the restrained forecast for NR demand globally. In contrast, the demand share among ANRPC member countries is expected to surpass 70%, with notable performances from China, Thailand, and India.

China, being a key consumer, is reported to account for nearly 44% of the global share in NR demand, playing a substantial role in the rubber market. ANRPC suggests that NR demand from China is likely to grow by 3.7% year-on-year, reaching 6.722 million tonnes in the previous year. Contributing to the positive demand scenario are Thailand, with a projected growth of 1.0% to 1.592 million tonnes, and India, where consumption is expected to increase by 5.7% year-on-year, reaching 1.400 million tonnes.

However, the demand trends in Malaysia and Sri Lanka present a stark contrast, with projected year-on-year declines of 20% and 24%, respectively, in 2023. These divergent trends underscore the varied dynamics within the NR market, influenced by regional factors, economic conditions, and geopolitical developments.

As the global outlook for NR demand evolves, ANRPC remains committed to monitoring and analysing the factors shaping the industry, providing insights for stakeholders in the natural rubber-producing countries. The intricate interplay of geopolitical events, economic shifts, and regional dynamics underscores the need for a nuanced and comprehensive understanding of the factors influencing the natural rubber market on a global scale.

This analysis sheds light on the multifaceted nature of the natural rubber industry, where global demand is subject to a delicate balance of geopolitical realities, economic factors, and regional dynamics. Stakeholders in the NR market, including producers, traders, and policymakers, are urged to stay attuned to these intricate dynamics for informed decision-making in an ever-evolving global landscape.