MUMBAI – Rubber contracts on Indian Commodity Exchange ended higher today, in line with gains in the spot markets, where concern over supply and improving demand from tyre companies pushed prices higher, analysts said.
“Since this is a lean period for rubber production, arrivals have decreased and buyers stepped up purchase this month,” a latex processor based in Kottayam said.
The most-active May contract on ICEX ended at 13,187 rupees per 100 kg, up 0.4% from Tuesday. In Kochi and Kottayam, the widely traded RSS-4 variety of rubber was sold at 128-130 rupees per kg today, up one rupee from Tuesday, traders said.
However, on Tokyo Commodity Exchange, rubber contracts declined today as the yen strengthened against the dollar. A firm Japanese currency makes the yen-denominated rubber costlier for overseas buyers.
The most-active October contract of natural rubber on the Japanese bourse ended at 187.8 yen per kg, down 0.6% from previous close.
The contracts on the Japanese bourse also declined due to profit booking after strong buying by investors on Tuesday as the market resumed trade after a week-long holiday. The exchange was shut from Apr 29 to May 6 on account of public holidays.
The overall outlook for natural rubber, however, remains positive due to a fall in global production estimate, analysts said.
In Jan-Feb, global production of natural rubber fell 5.8% on year to 2.14 mln tn, according to the estimates given by the Association of Natural Rubber Producing Countries.
In Thailand, price of RSS-3 variety was up by 0.84 cents at $175.70 per 100 kg. In Malaysia, the SMR-20 grade variety was sold 0.69 cents lower at $151.30 per 100 kg, according to Rubber Board data.
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:
Rubber contracts on ICEX are likely to keep gaining in the coming five-six sessions because of a fall in India’s natural rubber output, and as demand from domestic stockists are improving, traders said. End
US$1 = 69.71 rupees
Edited by Mainak Moitra