By Rahul Dhuri
MUMBAI – Futures contracts of rubber on the Indian Commodity Exchange closed lower today due to selling by market participants, after prices hit a one-week high of 13,234 rupees per 100 kg on Wednesday, traders said.
The most-active April contract of rubber ended at 13,185 rupees per 100 kg, down 0.2% from the previous close. A 217-tn rise in open interest at 1,108 tn indicated that traders see room for further decline in prices.
However, gains in benchmark contracts on Tokyo Commodity Exchange, and a rise in prices of natural rubber in spot markets of Kerala cushioned the fall in rubber contracts on ICEX, traders said.
Rubber contracts on TOCOM traded marginally higher today as the yen weakened against the US dollar, and on expectations of a US-China trade deal, analysts said. A weak Japanese currency makes the yen-denominated rubber cheaper for overseas buyers.
A US-China trade deal could help boost sagging Chinese economic growth and stimulate more demand for tyres and other rubber products, Commerzbank analysts said in a research note.
The US and China are seeking to resolve the remaining issues before Chinese President Xi Jinping completes a trip to Europe, which starts around Mar 21, news reports said, quoting sources. China is the world’s largest consumer of rubber.
The most-active August contract of rubber on the Japanese bourse ended at 197.2 yen (122.65 rupees) per kg, up 0.3% from the previous close.
Prices of natural rubber in key spot markets of Kerala rose today, owing to improved demand from domestic stockists amid an ongoing supply crunch in the market, said Thaha Mohamed, the owner of Kottayam-based Sara Traders.
Today, in Kottayam and Kochi, the RSS-4 variety was quoted in the range of 127-128 rupees per kg, up 1 rupee from Wednesday, traders said. Rubber Board data showed that both in Kochi and Kottayam, the RSS-4 variety was quoted at 127.50 rupee per kg, up 0.50 rupees from the previous close.
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 Kerala’s key spot markets are likely to rise in the coming days, due to an ongoing supply crunch in the market, and on expectations of a pick-up in demand from tyre manufacturers, traders said.
Gains in benchmark contracts of rubber on TOCOM are also seen supporting prices in the domestic market, they said. End
US$1 = 69.35 rupees
Edited by Aditya Sakorkar