By Rahul Dhuri
MUMBAI – The most-active March contract of rubber on the Indian Commodity Exchange hit a three-week low of 12,490 rupees per 100 kg today, tracking a fall in benchmark contracts on Tokyo Commodity Exchange in early trade, traders said. The March contract settled at 12,559 rupees per 100 kg, down 0.2% from Thursday.
The August contract of rubber on TOCOM hit an over one-week low of 195.3 yen (123.12 rupees) today because the yen strengthened against the dollar, while supplies of the commodity were ample, analysts said. Strength in the Japanese currency makes the yen-denominated rubber costlier for overseas buyers.
Weakness in Asian equities also weighed on prices, as did a fall in crude oil prices on New York Mercantile Exchange. Rubber prices take cues from those of crude oil because the latter is used to manufacture synthetic rubber, a substitute for natural rubber.
However, the most-active August contract on TOCOM ended 0.7% higher at 199.8 yen, as Thailand, Indonesia, and Malaysia, the top three global natural rubber producers will cut exports by 240,000 tn over four months starting Apr 1, the International Tripartite Rubber Council said in a release on Wednesday.
In Thailand, RSS-3 grade rubber was up $1.38 at $174.20 per 100 kg. However, in Malaysia, the SMR-20 grade variety was down 11 cents at $145.60 per 100 kg, according to data from India’s Rubber Board.
A fall in prices of natural rubber in key spot markets of Kerala also weighed on contracts on ICEX. The fall in rubber prices in spot markets was due to expectations of higher imports, traders said.
In Kottayam and Kochi, both in Kerala, the RSS-4 variety was quoted at 127-128 rupees per kg, down 1 rupee from the previous close, traders said. Data from Rubber Board showed that the RSS-4 variety was quoted at 127.00 rupees in Kochi and Kottayam, down 0.50 rupee in both markets.
The following table shows today’s closing prices of rubber, in rupees per kg, as detailed by the Rubber Board, and the change in prices, in rupees, compared with the previous close:
Prices of natural rubber in the key spot markets of Kerala are likely to rise in the coming days on expectations of a recovery in benchmark contracts on TOCOM. However, a likely rise in rubber imports is seen preventing sharp gains on ICEX, traders said. End
US$1 = 70.15 rupees
Edited by Avishek Dutta