By Rahul Dhuri
MUMBAI – The December contract of rubber on the Indian Commodity Exchange today settled at a three-month low 11,934 rupees per 100 kg, down 1% from Monday, tracking a fall in benchmark contracts on the Tokyo Commodity Exchange in early trade, analysts said.
In early trade, the most-active April contract of rubber on TOCOM hit an over two-year low of 153.1 yen (97.29 rupees) per kg today, tracking the benchmark contract on Shanghai Futures Exchange, analysts said.
Concern about demand for natural rubber due to ongoing trade tensions between the US and China also hit market sentiment.
However, the most active April contract on the bourse ended 0.4% higher at 154.2 yen per kg, tracking gains in crude oil prices on the New York Mercantile Exchange. Rubber prices take cues from those of crude oil, as the latter is used to produce synthetic rubber, a substitute for natural rubber.
A fall in prices of natural rubber in the key spot markets of Kerala also weighed on rubber contracts on ICEX, said Joy Alencherry, owner of the Kottayam-based Maria Rubber Links.
Prices of natural rubber in key markets of Kerala fell due to higher imports amid low demand from stockists, traders said.
Many buyers said they were not keen on domestic rubber as they have imported large quantities of the commodity, according to a Kottayam-based latex processor.
According to data from Rubber Board of India, imports of natural rubber in Apr-Sep were at 294,000 tn, compared with 225,000 tn in the corresponding period last year.
Today, prices in the key markets of Kerala fell slightly because buyers stayed away on account of a local holiday, said Alencherry.
In Kochi and Kottayam, the widely-traded RSS-4 variety of rubber was sold at 118-120 rupees per kg, down 1-2 rupees from Monday.
According to data from Rubber Board of India, the RSS-4 variety was sold at 120.00 rupees per kg in both Kochi and Kottayam, down 0.50 rupee from the previous close.
Today’s closing prices of rubber, in rupees per kg, at Kottayam and Kochi, as detailed by the Rubber Board, and the change in prices, in rupees, compared with the previous close are given in the following table:
|RSS-5||114.50||(-) 0.50||114.50||(-) 0.50|
The decline in rubber futures on Indian Commodity Exchange is likely to continue in the coming sessions due to higher imports amid low demand from stockists, analysts said.
Weakness in benchmark contracts on TOCOM is also seen weighing on rubber contracts, traders said. End
US$1 = 71.45 rupees
Edited by Avishek Dutta