By Rahul Dhuri
MUMBAI – The December contract of rubber on the Indian Commodity Exchange hit a six-week low of 12,500 rupees per 100 kg, before ending lower, tracking weakness in benchmark contracts on Tokyo Commodity Exchange, said Murugesh Kumar, product manager at Inditrade Derivatives and Commodities Ltd.
On ICEX, the December contract was at 12,513 rupees per 100 kg, down 25 rupees from Monday.
Futures contracts of rubber on TOCOM hit a two-year low of 160.6 yen (104.74 rupees) per kg today due to concerns about demand from China, analysts said.
Worries about an economic slowdown in China, the largest consumer of rubber, dampened sentiment.
The most-active April rubber contract on the Japanese bourse ended 0.5% lower at 161.7 yen per kg.
Weakness in natural rubber contracts on the Shanghai Futures Exchange and expectations of higher global rubber production further contributed to the downside.
In Thailand, RSS-3 grade rubber was down 91 cents at $140.33 per 100 kg and in Malaysia, the SMR-20 grade was down $2.11 at $125.65 per 100 kg, according to data released by the Rubber Board of India.
Meanwhile, a fall in rubber prices in the key spot markets of Kerala also weighed on rubber contracts on ICEX, traders said. Prices of rubber in these markets were down due to expectations of good availability of the commodity by mid-November because tapping in key growing areas has started, said Kurian Abraham, a rubber trader.
A rise in rubber imports and dwindling demand from domestic buyers and tyre manufacturers is also seen weighing on prices, traders said.
In Kochi and Kottayam, both in Kerala, the widely-traded RSS-4 variety of rubber was sold in the range of 125-126 rupees per kg, down 1 rupee from Monday, Abraham added.
According to Rubber Board of India data, the RSS-4 variety was quoted at 125.5 rupees per kg in Kochi, down 0.50 rupee from Monday. In Kottayam, it was sold at 126.0 rupees down 0.50 rupee.
Today’s closing prices of rubber, in rupees per kg, at Kottayam and Kochi, as detailed by the Rubber Board, and the change in prices, in rupees, compared with the previous close are given in the following table:
|RSS-4||126.00||(-) 0.50||125.50||(-) 0.50|
|RSS-5||121.00||(-) 1.00||121.00||(-) 1.00|
The bearish trend in the rubber market is likely to continue in the coming week, tracking weakness in benchmark contracts on the Tokyo Commodity Exchange and due to expectations of good availability of the commodity by mid-November, traders said. End
US$1 = 73.68 rupees
Edited by Avishek Dutta