Natural Rubber

There was no offered price for Qingdao rubber in USD. Overseas rubber slumped. The main force contract of TF05 dropped to 135.3 on January 31 from 144.7 on January 23, down 9.4 or 6.5%. The main force contract of JUR06 dropped to 177.0 on January 31 from 191.0 on January 23, down 14.0 or 7.3%. The SHFE rubber was slumped before the Spring Festival. The main force contract of RU05 fell by 335 or 2.70% and closed at 12,085, and the main force contract of NR04 fell by 250 or 2.41% and closed at 10,110.

Dongying.com: In order to implement the first-level response measures for major public health emergencies, seven highway toll stations in Dongying province including Lizhuang Toll Station, Rongwu Expressway Kenli North Toll Station, Lijin Toll Station, Donggang Expressway Isolated Island Toll Station, Racecourse Toll Station, Jixian Toll Station, and Donglu Expressway Yanwo Toll Station are temporarily closed from 00:00 on January 30, 2020. The recovery time will be notified separately according to the development of the epidemic situation.

As of January 23, the subtotal inventories of the RU contract minus futures inventories were 8,000 tons, the lowest level in the same period in history. The subtotal inventories of the NR contract minus futures inventories were 29,000 tons, a month-on-month increase of 82.5%. During the same period, the domestic all-steel operating rate was 26.7%, down 53.0% year-on-year. The resumption of most production lines was postponed to at least after February 10.

Futures Operation Advice: The epidemics curtailed demand for commodities. It is advised to fully hedge the position and wait and see.

(For reference only)