MARKET COMMENTARY
As the trading in holiday-shorted week commences, TOCOM rubber futures are in deep red, falling more than 3.5 per cent to hit its lowest level in two weeks, weighed down by strengthening Japanese yen, while SHFE, AFET and Malaysian market stayed closed on account of Labor Day holiday.
In the local market last week, natural rubber prices were seen retreating after the recent run. RSS4 graded rubber in the spot as well as future market was off from the multi-month highs. Fall in natural rubber prices in the major overseas market weighed on.
MARKET NEWS
According to a deputy chairman of the Rubber Holder Co-operatives Federation of Thailand,the production of natural rubber has fallen about 50% from January to April year-on-year due to the drought.
Vietnam’s natural rubber exports could drop 12 percent from a year ago to around 1 million tonnes in 2016, as part of the country’s commitment to cut supply and help stabilise prices, Vietnam Customs said.
Sinochem International Corporation plans to acquire Halcyon Agri Corporation Limited, one of the top five natural rubber companies in the world. If the deal goes well, Sinochem International Corporation will become the world’s largest natural rubber supplier.
India’s natural rubber production fell to its lowest level in about two decades in 2015-16 to 563000 tonnes, a 13 per cent fall from the previous year’s production of 645000 tonnes. Consumption declined as well, by three per cent on YoY basis to 987540 tonnes.
A Ajithkumar, secretary to the Kerala Governor, has been named as the new chair of the Rubber Board.
India Meteorological Department, in its first forecast for 2016 South-West Monsoons, have predicted an ‘above normal’ monsoon rains for this year.
Japan’s weather bureau said that there was a high possibility that a La Nina weather pattern would emerge in summer after El Nino ends.
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Geofin Comtrade
