The global supply of natural rubber is anticipated to increase by 4.5%  while demand is anticipated to grow by 2.8%, according to the Association of Natural Rubber Producing Countries.

The slower production growth in 2018 can be attributed to a lower production anticipated by Thailand, down by 1.2% on a year-to-year basis, the association’s Natural Rubber Trends & Statistics January 2018 report says.

The upward swing in global economic outlook during 2018 is a result of global growth momentum and the expected impact of the recently approved U.S tax policy changes. The outlook on commodity markets is also expected to improve during 2018 due to efforts of agreed oil production cut by the Organization of the Petroleum Exporting Countries (OPEC) and geopolitical tensions in the Middle East, which will support the oil prices. These actions may lead to better recovery of natural rubber prices this year, the report said. .

In January 2018, an early winter season rubber farmers faced China has slowed down their production. Slowdowns, which are expected in other parts of the world, could lead to a better-balanced supply-demand natural rubber market in the coming months.