In May, Thailand’s rubber prices had slightly changed in line with future markets. For average RSS3 price announced by Central Rubber Market in Songkhla stood at 39.88 Baht/kg, up 0.40% from the previous month due to the following factors.

The COVID-19 pandemic took effects on supply chains from upstream to downstream; moreover, it also affects people’s livings, businesses, industries, as well as the rubber industry both directly and indirectly. In May, the same as in many countries, Thailand has loosened the lockdown measure because the number of COVID-19 infected patients is low. However, Thai government has prolonged the Emergency Decree on Public Administration in Emergency Situations, B.E. 2005 in May. Meanwhile, the private sector has prepared to restart the production line after the temporary closure in the last 2 months. This situation is the challenge for the government in using measures to support rubber prices as well as farmers both in short term and long term. It was projected that the government's financial measures will lessen COVID-19 impacts. However, understanding and accepting the changes are important, which will support every related party to adapt themselves appropriately. For rubber farmers, they should adapt themselves quickly. For example, they might grow other crops that will provide higher income or do Integrated Farming in their rubber plantations, and they should find extra income. Moreover, innovation development is important in value-added to rubber, and it will support Thailand's rubber prices to be more stable in the long term.

In May, the Rubber Authority of Thailand (RAOT), the Department of Highways, and the Department of Rural Roads have agreed to use rubber to modify and increase the efficiency of the Road Safety. Both Rubber Fender Barrier (RFB) and Rubber Guide Post (RGP) will be used in the project. Furthermore, they will support rubber farmers and farmer groups in processing rubber to reach the rubber domestic usage promotion measure of the government.

In 2020, Thailand’s economy tends to shrink in line with the global economy. The inflation rate tends to be negative. Tourism, exports, consumption, private investment, and related employments have greatly affected by the economic situation which causes by COVID-19. Even though the government has loosened the lockdown measure, the household sector and the private sector still suffer from liquidity problems. However, financial measures and the Bank of Thailand are the great important factors in lessening the liquidity problems, supporting economic recovery and economic growth in the future. As for the outcome of the Monetary Policy Committee meeting on May 20, 2020, the committee has agreed to cut the policy interest rate by 0.25% per year from 0.75% per year to 0.50% per year effective immediately. In terms of Thailand’s international trade in April 2020, Thailand’s export income value 613,979.27 million baht, up 5.32% yoy, and down 11.45% compared with March 2020. From January to April 2020, Thailand’s export income value 2,517,135.79 million baht, down 1.07% yoy (Ministry of Commerce, 2020).

The Institute for Supply Management (ISM) informed that the manufacturing sector’s Purchasing Managers’ Index (PMI) of the US up to 39.8 in May from 36.1 in April. Meanwhile, Thailand’s PMI up to 41.6 in May from 36.8 in April. 

On April 20, 2020, West Texas Intermediate (WTI) crude oil price shrinks the lowest level for 20 years. The price drops as -37.63 USD/barrel. This is because investors were sell out their contracts in May before the contract expires to avoid purchasing WTI crude oil if the contract expire in April 21, 2020. The U.S. Energy Information Administration (EIA) has announced the crude oil inventories increased more than 7.9 million barrels as 534.4 million barrels for the week ending May 22, which contrasts with the market projection that it would decrease by 1.9 million barrels. Recently, crude oil prices are supported by the increase of the oil demand after many countries loosen their lockdown measure. Moreover, many crude oil refineries increase their production. However, investors are still worried about the tension in Hong Kong after China is going to roll out the new Hong Kong security law that might cause the US boycott China as well as cause national conflict between the two countries.  

In April 2020, Thailand exported 351,802.83 tons of natural rubber (including compound rubber), down 5.50% from the previous month, and up 3.45% yoy, generating export income of 15.1 billion baht, down 6.37% from the previous month, up 1.85% yoy.