Report Industry Investment Rating - The report gives a long - term investment rating of "opportunistic long - position allocation" for rubber [1] Core Viewpoints of the Report - The rubber price is likely to rise rather than fall in the fourth quarter. After the price decline has released some risks, investors can wait for a suitable upward - driving factor and opportunistically set up long positions [2][29] Summaries Based on Relevant Catalogs 1. Supply and Demand Analysis of the Rubber Industry - Supply: Cote d'Ivoire and Thailand are expected to increase rubber production by 200,000 - 300,000 tons. Currently, port inventories continue to decline, and inventory accumulation is not obvious [2][29] - Demand: The transportation demand from the real estate and infrastructure sectors is weak [2][29] 2. Farmers' Crop Choices in Different Regions Cote d'Ivoire Farmers' Choice between Cocoa and Rubber - Economic Feasibility: Cocoa has a shorter return cycle (3 - 4 years) but unstable income due to price fluctuations and yield decline. Rubber is a long - term investment (7 - year maturity), offering stable and regular cash flow after tapping [4][5] - Climate Conditions: Cocoa is more sensitive to climate change, while rubber is more resilient to drought and high - temperature [6] - Labor Input: Cocoa cultivation is relatively labor - flexible, while rubber tapping is highly specialized and labor - intensive [6] - Land Tenure: Clear and secure land tenure is necessary for farmers to invest in rubber [7] Indonesian and Malaysian Farmers' Choice between Rubber and Palm Oil - Economic Return: Palm oil generally has higher unit - area returns and a faster return cycle (2 - 3 years) compared to rubber (7 - year investment cycle). Palm oil prices are more volatile, while rubber has more stable downstream tire demand [12] - Labor Input: Rubber tapping is labor - intensive and requires skilled workers, while palm oil harvesting has lower labor intensity and is more semi - mechanized [13] - Planting Conditions: Both are suitable for tropical rain - forest climates, but palm oil has more demanding requirements for sunlight, precipitation, and terrain. Rubber can grow on more barren land [14] - Policy: Governments in Indonesia and Malaysia have promoted palm oil planting through subsidies and policies like biodiesel mandates. The total planting area of palm oil has changed little, while the rubber tapping area has decreased significantly [15][17] 3. Reflection on Classic Mistakes in Supply Prediction - The analysis assumed that farmers' rubber - production decisions are profit - maximized, but in reality, factors like rainy - season transportation difficulties lead to an increase in standard - grade rubber production rather than high - value rubber, contrary to the initial analysis [18][19] 4. Impact of EUDR on the Rubber Industry - EUDR Origin and Requirements: It originated from the EU's Green Deal in 2019. It requires companies to conduct due diligence on product origin and compliance. Non - compliance may result in penalties [21] - Implementation Process: It officially took effect in 2023 with an initial 18 - month transition period. The compliance date has been postponed multiple times. The latest plan is that large and medium - sized enterprises will be enforced from December 30, 2025 (extendable to the end of June 2026), and micro and small enterprises until December 2026. The postponement is seen as a short - term demand negative, while the confirmation of the implementation time is a marginal positive but with limited expected impact [22][23][25] 5. Rubber Demand Increment from Ukraine's Reconstruction - Reconstruction Cost: The cost of Ukraine's reconstruction in the next decade is estimated to be $524 billion, with high - cost items including housing, transportation, energy, etc. [26] - Rubber Demand: Based on investment - driven heavy - truck demand and tire - replacement assumptions, the total natural rubber demand for heavy - trucks and construction machinery is estimated to be 59,700 - 95,500 tons in the first year, 59,700 - 95,500 tons in the second year, and 39,800 - 63,700 tons in the third year [27][28] 6. Macroeconomic Factors Affecting Rubber Prices - Negative Factors: US tariff - adding events in April and September and the EU's anti - dumping and countervailing measures on Chinese tires have put downward pressure on rubber prices [29] - Positive Factors: There are always positive expectations from Chinese policies [29]