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[Geojit Comtrade] Daily report on Natural Rubber: September 3, 2013

MARKET COMMENTARY

The week’s session began on a positive note with NMCE rubber futures rising around two per cent on Monday. RSS4 in the physical market gained as well. Amidst restricted arrivals, advances in the overseas market boosted prices in the local market. Sharp rallies were witnessed in the overseas market last day on upbeat data from China. And on Tuesday, TOCOM and SHFE rubber futures were seen extending the previous session advances. SHFE rubber futures had jumped three per cent earlier today, tracking advances in the TOCOM. The benchmark February rubber futures on TOCOM rose to a three month high. Weaker yen amidst reports of delayed shipments from Thailand and China’s moves to buy natural rubber for the country’s buffer stock probably lent support to the prices.

MARKET NEWS

Thai cabinet is to consider both short- and long-term measures aimed at tackling the issue of low rubber prices today. For the short term, rubber farmers will receive 1,260 baht per rai of rubber trees being tapped, although the amount will be limited to 10 rai per farmer. Medium and long-term measures include support for agricultural cooperatives in arranging for rubber processing, and the allocation of 20 billion baht of low-interest loans for the expansion of rubber production capacity and improvement of machinery.

Thailand to stop collecting fees on rubber exports until Dec. 31 to help boost local prices, Office of the Rubber Replanting Aid Fund says.

Michelin & Cie plans to relocate a production plant to Thailand and is ready to help boost rubber demand in the Southeast Asian nation, Thailand’s farm minister Yukol Limlamthong says in statement.

China’s National Development and Reform Commission is planning to buy 50,000-60,000 tons of natural rubber for the country’s buffer stocks in the second half of 2013.

Several thousand tonnes of Thai rubber shipments were delayed as a prolonged protest by rubber farmers in Thailand’s southern province of Nakhon Si Thammarat disrupted transportation and logistic systems, exporters says.

TECHNICAL VIEW

 RUBBER Oct NMCE

While there exist positive sentiments, it requires breaking and sustaining above 18600 for further upsides. Else, lower corrective moves to 18300/18100 ranges cannot be ruled out.

TURNAROUND

Resistances

LEVELS

 Supports

18600/18800

18600-18100

18470/18350

18970/19060

18200-18100

19250/19380

17950/17800

 

Source: Geojit Comtrade

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