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[Geojit Comtrade] Daily report on Natural Rubber: Aug 29, 2013

MARKET COMMENTARY

NMCE rubber futures jumped on Wednesday, probably tracking sharp moves in crude oil and other industrial commodities after Indian rupee plunged to record low. Steep depreciation in rupee coupled with narrowing difference between prices in the local and international market amidst thin arrivals may have provided a push to the prices. However, in the physical market, RSS4 traded rather steady. Activities stayed subdued.

On Thursday, TOCOM rubber futures extended losses for the third consecutive session on simmering worries over geopolitical tensions in Syria. SHFE rubber futures retreated as well while AFET rubber futures were seen paring the opening losses. In the mean time, protests by farmers continued in Thailand demanding government help to prop up prices.

MARKET NEWS

Thailand plans to spend 30b baht to support rubber industry, aiming to boost prices and reduce supply, Deputy Prime Minister Kittiratt Na-Ranong says. Govt to spend 15b baht to provide lowinterest loans to producers of rubber products who want to buy new machinery or improve productivity, 10b baht to subsidize production costs for farmers nationwide and 5b baht to provide lowinterest loans for farmer groups to process rubber.

TOCOM August rubber futures expired with 126 lots being delivered as against 565 lots delivered in July.

Thai Finance Ministry is seeking a budget of 25 billion baht to help rubber farmers cope with decreasing prices of rubber in the world market.

Rubber farmers from northern Thailand plan to stage a mass protest on Sept 3 if the government does nothing to prevent rubber prices from sliding further.

Crude rubber stockpiles held at Japanese warehouses fell 10.6 percent to 7,571 metric tons on Aug. 10, according to data from the Rubber Trade Association of Japan.

Kochi to host two international rubber conferences – Asian Latex Conference (ALC) 2013 on September 5 and 6 and India Rubber Summit and Dinner (IRSD) 2013 on September 7.

TECHNICAL VIEW

 RUBBER Sep NMCE

Late moves towards 18400 ranges, breaching stiff resistance at 18250 may have the potential to extend further. However, lower corrective dips to 18200 or more to 18050 cannot be ruled out.

TURNAROUND

Resistances

LEVELS

 Supports

18380/18500

18700-17800

18200/18050

18700/18800

17900/17800

18970/19250

17600/17500

 

Source: Geojit Comtrade

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