Home Global rubber market news Rubber prices gain on promise of extended market support by Kerala Govt

Rubber prices gain on promise of extended market support by Kerala Govt

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Kerala Government had announced  the open market procurement of rubber from the growers in the state would remain till prices reach Rs 17100 for RSS 4 grade. Procurement will be through the Kerala State Co-operat.

KOCHI (Commodity Online): Rubber prices have started moving up following Kerala Government assurance that it will continue procurement operations till prices reach Rs 17100 per 100 kg. Spot rubber prices rose from a low of Rs 14200 per 100 kg to Rs 14400 for RSS$ grade. At National Multi Commodity Exchange (NMCE), rubber futures for February delivery had fallen sharply to 14200 per 100 kg levels before climbing back to 14453 levels on Wednesday.

The State government has decided to procure rubber directly from rubber growers by paying Re. 1 more than the rates prevailing in the market till the prices climb to Rs.171,000 a kg.Procurement will be through the Kerala State Co-operative Rubber Marketing Federation (Rubbermark), primary rubber co-operative societies and co-operative marketing societies.

Despite government measures to shore up prices, market is not witnessing a bounce as global trends continue to be weak on China demand growth concerns. TCOOM rubber futures tumbled 3% on Thursday while weakness was visible in AFET rubber futures also.

State Government was of the view that prices had fallen in line with the crash in global markets but it has allocated Rs 10 cr in the State Budget for market intervention operations. It has also requested the Centre to consult the State Government with regard to policy decisions with respect to import of natural rubber in future.

Kerala Finance Minister, KM Mani, said the government was much concerned about the pathetic condition in the rubber growing areas of the state. Around 92 per cent of the rubber production in India is being carried out in Kerala.

NMCE Rubber Outlook
On an intra-day perspective Rubber March futures at NMCE is exhibiting bearishness, according to Milan Shah, Agri Commodities analyst at Commodity Online. He advises selling March at current market price ( 14574) with stop loss of 14720, targetting Rs 14,300.

Geojit Comtrade expects NMCE March to stretch higher to 15100 levesl which will lead to sharp correction to 14750/14600 levels.

CommodityOnline

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