a big shift in the rubber market?

- Aug 17, 2018-

After the no. 20 adhesive futures come on the market, the deliverable quantity of futures will increase greatly, and the delivery advantage of all latex will disappear immediately. The delivery property disappeared, leading to the price of other rubber varieties before the September delivery. Because of the former Shanghai rubber relative to other rubber varieties premium water, Shanghai rubber yesterday, so only let the full latex foam in the market expectations of extrusion, legitimate. However, after the bubble extrusion, Shanghai gum will not necessarily follow the trend of decline, the price impact factors are now much more than in the past.


The way you trade will change a lot

In recent years, the non - standard period of buying mixed gum - Shanghai gum has developed rapidly. The exclusive delivery property of all latex disappears after the release of no.20 adhesive, which makes the futures price close to the spot price before delivery. The spread will also be significantly reduced, rubber will be like most other futures varieties, only in a very few cases, will appear the spread widening, can participate in the arbitrage. As things stand, there is a lot of time throughout the year to participate in non-standard liquidity, and the risks are not great, but the benefits are considerable. The future spread is in a reasonable range for a long time, and the time for the non-standard period of Shanghai rubber is coming to an end.


rubber market

Short-term core factors out of supply and demand

After 20 mark glue futures appear on the market, existing futures contract must divert a lot of capital. For bulls, at present, there are about a large number of warehouses, but also a large number of non-standard arbitrage, do more than 20 adhesive futures. For shorts, the era of non-standard covers is over, a trade that needs to be completely wound up, and large amounts of non-standard futures and spot positions need to leave the market.