2023 Global NBR Consumption Shifts Through Asian Trade Flow
Preface: Not only is Asia the world’s largest supplier of NBR, but it is also the largest consumer. At present, it is basically formed that supply from South Korea and Japan mainly flows to China, India, the U.S., Southeast Asia and Europe, while supply from China mainly flows to Southeast Asia, India, etc., as trade characteristics. This article mainly analyzes the new features and impacts of NBR consumption changes in 2023 through the trade flow of NBR in Asia.
Among the world’s major NBR-producing countries and regions in 2023, three of the top seven are in Asia, namely China, South Korea and Japan. Asia leads in global NBR capacity, with capacity accounting for about 66% of the global total, of which China’s capacity accounts for approximately 32%. Despite the recent sluggish growth in NBR consumption in China, it remains the world’s largest producer and consumer of NBR in terms of countries, which is largely due to China’s vast manufacturing capability.
Looking at the trade flow, currently, supply from Asia (China, Japan, South Korea) mainly flows to Southeast Asia, South Asia, the Middle East, North America and Europe, while European resources mostly flow to China and North America. More than 90% of global capacity is concentrated in Asia and Europe, which means that by looking at the trade flow of goods from Asia and Europe, one can generally glimpse the global trade flow of NBR.
Global NBR Trade Flow
Specifically, looking at Asia, according to data published by KITA, South Korea exported 101kt of NBR from January to September 2023, an increase of 6.8% Y-O-Y. In terms of trading partners, although China remained the largest export trading partner, the volume decreased by 13.6% Y-O-Y, while the export volume to India increased by 26.5% Y-O-Y. According to data published by Japan Customs, Japan exported 30.4kt of NBR from January to September 2023, a decrease of 13.16% Y-O-Y. In terms of trading partners, the export volume to India, Indonesia and Vietnam increased by 15.28%, 22.84% and 73.66%, respectively.
Source: KITA
Source: Japan Customs
As for China’s market, the growth points in the export volume in 2023 are mainly concentrated in India. From January to September, the export volume to India ranked first, totaling 7,419mt, up 119.95% Y-O-Y, accounting for 42% of the total, which was an expansion of 16% from 2022. On one hand, India’s economy continued to show steady growth in 2023, attributable to increased consumer spending, infrastructure spending and the establishment of more businesses. The IMF predicted that India’s economy would grow by 6.3% in 2023, and the economic growth boosted local demand for rubber raw materials. On the other hand, some traders in this area purchased goods originating from other countries in China to meet the needs of local downstream users.
Overall, in 2023, the economic growth of some developing countries is noticeable, leading to an increase in NBR consumption, with the goods of major NBR export trading countries being somewhat skewed. Some developing countries have large populations and growing middle class, and as consumption upgrades and changes in consumption structures, sustained internal demand growth drives the demand for bulk commodities, including NBR. The economies of emerging markets and developing economies may continue to grow in the future, likely continuing to drive the growth of NBR exports from China. In the future, the proportion of China’s NBR exports in the total demand may gradually increase, and by then the impact of exports on the market price of China’s NBR may increase.
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