Factors Affecting the Volatility in Ribbed Smoke Para Rubber Sheet No. 3 Market of Thailand

Abstract

Thailand is the world's leading producer of para rubber; however, farmers and related businesses in the country continuously face significant volatility in the domestic rubber market. As a result, the study’s goal is to identify factors influencing the volatility in RSS3 (ribbed smoked sheet no.3) para rubber market of Thailand, using the price of RSS3 para rubber in Hat Yai central market, Songkhla Province, as a representative of the rubber market.  Secondary data were collected over consecutive months from January 2015 to December 2024.  The multiple linear regression model (MLR) and artificial neural network (ANN) model were used to assess various variables.  The mean absolute percentage error (MAPE) was used to compare the accuracy of the models.  In this study, the dependent variable is RSS3 para rubber price in Hat Yai central market, Songkhla Province.  The independent variables include crude oil prices, synthetic rubber prices, RSS3 para rubber export quantities, Thai para rubber export quantities, RSS3 para rubber price in Bangkok, Tokyo and Singapore Futures Exchanges, and the exchange rate between the Thai baht and the US dollar.  The results reveal that the most appropriate model is ANN model.  The top three variables that most significantly affect the changes, are as follows: RSS3 para rubber price in Bangkok (100%) and Singapore (51.8%) Futures Exchanges, and Thai para rubber export quantities (29.8%). Farmers, entrepreneurs, and government can use this information as a source of information for decision-making.