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The 2021 recovery in global rubber demand is expected to fall short of expectations.
2022-02-19
Salvatore Pinizzotto, Secretary-General of the International Rubber Study Group (IRSG), stated that although demand for rubber in Asia—particularly in China—is growing robustly, the recovery of global rubber market demand in 2021 is expected to fall short of expectations, given the potential delay in the large-scale rollout of vaccines.
Among these factors, the growth in automobile and tire sales will exert short-term pressure on market demand. Additionally, he anticipates a substantial near-term expansion in the waste‑tire sector. In particular, the gloves industry could serve as a key driver, propelling rubber demand into a “new normal.”
According to Salvatore Pinizzotto, in 2020, travel restrictions imposed to contain the pandemic weighed on both tire and automobile sales, significantly dampening global rubber demand. With robust economic recovery expectations across major economies this year, coupled with the ongoing expansion of vaccination coverage, the IRSG projects that natural rubber demand will grow by 7% in 2021, while synthetic rubber demand is expected to increase by 7.2%. On the production front, natural rubber output is forecast to rise by 5% in 2021, as declines in Southeast Asian countries are offset by growth in other producing regions.
In fact, he believes that, owing to the varying impacts of pandemic transmission patterns, containment measures, and monetary policies across regions, the recovery of the rubber supply chain is uneven. Overall, however, the rubber industry is shifting from a “just-in-time” production model to a “just-in-case” approach.
In addition, Salvatore Pinizzotto noted that relevant authorities must also address the declining attractiveness of agricultural activities and the impact of global warming on rubber production. It should be borne in mind that rubber cultivation and harvesting are labor-intensive endeavors; over the past period, persistently low rubber prices, coupled with rising production costs, have led to a decline in the number of people engaged in these activities. Meanwhile, as extreme weather events become more frequent, rubber farming in certain regions has already been adversely affected.
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