MARKET COMMENTARY
As the week progresses, natural rubber continues to slide. On Wednesday, SHFE rubber futures plummeted with the benchmark September rubber futures plunging more than six per cent to hit its weakest level since December 2014. TOCOM rubber futures tumbled six per cent as well in tandem with the moves on SHFE to 10-week low. Amidst worries over Greece, free fall in China stock market and sharp declines in other industrial commodities overnight spooked investors. Despite series of measures being unveiled to stem the fall, equities continued to slide.
In the local market, natural rubber stayed under pressure. Bearishness in the major overseas market coupled with subdued demand bothered the overall market sentiments, pressurizing prices to move south.
MARKET NEWS
According to the Rubber Trade Association of Japan natural rubber imports by the nation rose 17.2 per cent on YoY basis to 62256 metric tonnes.
Based on the Kerala government’s price stabilization project, Kerala State Cooperative Rubber Marketing Federation has decided to procure 5000 tonnes of rubber in the first phase.
Kerala government has issued orders, framing the guidelines for the implementation of a ‘Rubber Production Incentive Scheme’, which guarantees a price of Rs 150 for a kilogram of rubber.
Rubber inventories in the warehouses monitored by SHFE rose 4.6 per cent on weekly basis to 153125tonnes.
Kerala State Chief Minister informed the Assembly that government would ensure that small-scale rubber growers with two hectares of land or less will get an assured price of Rs.150 a kg.A total of Rs 300 crore has been earmarked in the state budget for ensuring fair price for rubber which will be utilized for this new scheme.
Rubber Board has clarified that Kerala and Kanyakumari dist. Of Tamil Nadu would continue to receive subsidy for planting and replanting rubber.
Malaysia plans to use 10 per cent of its rubber supply in roads from 2016 as it looks to eat into excess supplies and shore up rubber prices.
Raising concern over the fall in rubber production for the third consecutive year, the tyre and rubber industries have sought urgent government intervention to stem the slide in domestic production.
Kerala will constitute a subcommittee to look into various issues related to rubber farmers. The committee’s aim is to see that the financial assistance provided by the Government reaches the farmers effectively.
Kerala FM says the central government has assured that the state has not been excluded from the rubber subsidy scheme and also added that the state has sought Rs.500 crore for the rubber procurement scheme announced by the state budget.
Source: Geofin Comtrade
