By Rahul Dhuri
MUMBAI – Futures contracts of rubber on Indian Commodity Exchange ended lower today, tracking benchmark contracts on Tokyo Commodity Exchange and a fall in prices in the spot markets of Kerala, analysts said.
On ICEX, the December contract ended at 12,178 rupees per 100 kg, down 87 rupees from Monday.
Natural rubber contracts on TOCOM were trading lower today, as traders booked profits after prices hit a two-month high of 168.0 yen (105.06 rupees) per kg on Monday, analysts said.
The most active May contract of rubber on the Japanese bourse ended 1.4% lower at 162.6 yen per kg.
On Monday, rubber prices rose as US-China trade talks showed signs of progress. China is the largest consumer of rubber in the world.
A fall in prices of natural rubber on the Shanghai Futures Exchange and a strong yen against the US dollar further weighed on prices. A strong Japanese currency makes the yen-denominated rubber costlier for overseas buyers.
However, prices of rubber are expected to recover gradually as the largest producers of rubber, such as Thailand, Indonesia and Vietnam, plan to cut output, traders said.
A fall in prices of natural rubber in 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 rubber in the spot markets were slightly lower, with more sellers emerging today, traders said.
After a small increase in prices on Monday, many sellers came to the market to cash in on any improvement in price, a Kottayam-based rubber dealer said.
“Traders are selling one or two lots to tyre companies, just enough to engage with buyers,” the dealer said.
In Kottayam, the widely-traded RSS-4 variety was sold at 119.50 rupees per kg, marginally down from Monday.
The RSS-4 variety was sold at 119.00 rupees per kg in Kochi and Kottayam, down 0.50 rupee from the previous day, data from the Rubber Board of India showed.
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-4||119.00||(-) 0.50||119.00||(-) 0.50|
|RSS-5||116.50||(-) 0.50||116.50||(-) 0.50|
Prices of natural rubber in key spot markets of Kerala are likely to be under pressure in the coming days due to a surge in imports of the commodity, traders said.
However, prices are expected to recover gradually as the largest producers of rubber, such as Thailand, Indonesia and Vietnam, plan to cut output to curb the fall in prices, traders said. End
US$1 = 70.49 rupees
Edited by Avishek Dutta