Automotive sector growth in emerging and advanced economies fuels consumption. Production faces challenges from weather and diseases. China, Europe, and the US will see demand recovery. This imbalance will keep prices firm and the market tight.

Global demand for natural rubber is projected to exceed production for a sixth straight year in 2026, with accelerating growth in the automotive sector across emerging and advance economies driving consumption, an industry ‌body said. Global production ⁠is forecast ⁠to grow by 2.4 per cent to reach 15.2 million to tons in 2026, following a modest 1.4 per cent increase in 2025, said ANCPA

"Output growth continues to lag expectations despite improved grower prices since 2025 due to adverse weather, limited replanting of aging trees, persistently low productivity among smallholders after years of depressed prices, and competing land-use changes", it said.

ANRPC added that rubber plantations have also faced an outbreak of major leaf fall diseases that ‌spread across several producing countries and caused significant yield looses that have reached as high as 30-35 per cent in some areas.

Meanwhile, demand growth in China, Europe, and the ⁠US is expected to recover modesty in 2026, it said. This is likely to be driven by rising new vehicle registration in the EU, stronger tyre shipment projections in the US, the EU-India and US-India trade agreements covering rubber products, and continued government incentives for electric vehicle purchases in China, it added".