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  NR SITUATION OF   October 2019 [Current Year]  
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Thailand Monthly Rubber Report – October 2019

October average RSS3 price announced by Central Rubber Market in Songkhla stood at 38.79 Baht/kg, down 7.02 % from September due to the following factors.
In October, Thailand's rubber prices slightly dropped due to the strengthening baht which affected by the US dollar sell-off and the investors are on waiting mode. This is coupled with inclement weather in Thailand, especially an increase in rainfall across the southern region of Thailand. Meanwhile, the futures markets and the foreign markets have increased in the short-term.
For the manufacturing sector’s Purchasing Managers’ Index (PMI) of counterparty countries, especially China, it increased to 51.7 in October from 51.4 in September. However, PMI was less than 50, it showed that the manufacturing sector was a slowdown. Meanwhile, the Institute for Supply Management (ISM) informed PMI of the US up to 48.3 in October from 47.8 in September. However, the Federal Reserve System (Fed) announced to cut the interest rate to 1.50-1.75%. This is the third time of 2019 that they decided to cut the interest rate to boost US economic growth amid global economic recession. Moreover, in October 2019, the number of non-farm laborers increased 128,000 positions. 
The expansion of the Thailand economy tends to slow down to 2.8% in 2019 and 3.3% in 2020. The global market demand tends to decrease in commodities such as rice, sugar, cassava, oil palm, and rubber. Currently, the southern region of Thailand is monitoring the fungal disease called Pestalotiopsis spreading through plantations affected from Malaysia and Indonesia through the wind. The disease affected reducing of 15% or approximately 540,000 tonnes of Indonesia’s rubber yield. Crude oil price tends to slip as crude oil held by the US increased. The U.S. Energy Information Administration (EIA) cut its growth expectations for global oil demand in 2019 and 2020, down 50,000-100,000 barrels per day. As well as OPEC+ plans to reduce their crude oil production volume more than the former agreement which is 1.2 million barrels per day as the concern of the global oil demand growth in 2020. In addition, OPEC+ will discuss the crude oil production volume at the meeting on December 5-6, 2019. Thailand's car production and export are slow down which may affect the natural rubber industry. However, there are measures from the government to tackle the problem of falling rubber prices; for example, rubber pledging policy phrase I which started to distribute money on September 15, 2019, as well as reduced some regulations to help rubber smallholdings. In the production sector, Thailand was supported by the tourism sector, which is the most expansion in the past 15 months, as well as the agricultural sector which continued to expand. Furthermore, Thailand’s economic stability is still in a good state.
In September, Thailand exported 311,458 tons of natural rubber (including compound rubber), down 10.61% from August and 15.32% yoy, generating export income of 12.8 billion baht, down 15.81% from August, down 18.22% yoy. Overall, during the three quarters of 2019, Thai NR exports (including compound rubber) reached 3,316,698 tons, down 2.47% yoy. The YTD export value touched 142 billion baht, down 6.68% yoy.
In tyre sector, in September Thailand exported 10.87 million units of all tyres, up 1.56 % yoy, with the export value of 14.3 billion baht, up 5.18% yoy. Overall, during three quarters of 2019, Thai exports of all tyres reached 100.46 million units, up 55.30% yoy, generating export revenue of 131 billion baht, up 75.83 % yoy.



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