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[Geojit Comtrade] Daily report on Natural Rubber: June 24, 2013

MARKET COMMENTARY

RSS4 was held in tight ranges while latex (drc 60%) prices were seen rising last week on restricted arrivals and heavy monsoon rains in the major rubber growing areas in Kerala. In the physical market, RSS4 steadied near Rs.175.00 a kg while on NMCE, a sideways movement was witnessed with mild negative bias. Even as supply crunch in the market carries to lend support, increasing prospects of imports and slackening demand are likely to restrict gains.

Stretching previous week losses, natural rubber prices continues to move south in the international market on Monday. Worries over demand from the top consumer China carry on pondering over the market. TOCOM rubber futures are at nine month low while September rubber futures on SHFE are near its weakest level since 2009.

MARKET NEWS

Natural rubber inventories in the warehouses monitored by SHFE rose by 48 tonnes to 114556 tonnes last week.

According to Thai deputy commerce minister, seven state agencies and private firms will jointly set up a rubber futures fund with an initial investment of Bt210 million to buy at least 42 billion tonnes of the agricultural commodity in July.

According to Rubber Trade Association of Japan, crude rubber inventories in the Japanese ports as of June 10 fell to 13209 tonnes, down 1035 tonnes over a period of ten days to its lowest level since March 10.

Natural rubber production in India rose 1.7 per cent to 59000 tonnes in May while consumption dropped 3.1 per cent to 83000 tonnes. Imports slumped 17 per cent to 17334 tonnes.

Natural rubber imports by China fell to 180000 in May compared to 227320 tonnes imported the previous month.

According to China Association of Automobile Manufacturers, wholesale deliveries of cars, multipurpose and sport utility vehicles increased 9 percent to 1.4 million units in May compared to 13 per cent growth achieved during the previous month.

According to ANRPC, natural rubber production from Indonesia is seen rising 5.0 per cent to 3.18 million tonnes while that of Malaysia is seen at 980000 tonnes, up 6.8 per cent this year.

TECHNICAL VIEW

 RUBBER July NMCE

Prices have been varying inside 17100-17500 ranges for the past few sessions and require a breakout from either the sides for further directional moves.

TURNAROUND

Resistances

LEVELS

 Supports

17350/17500

17500-17100-16850

17100/17000

17650/17800

16950/16850

18000/18100

16600/16500

 

Source: Geojit Comtrade

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