MARKET COMMENTARY
While the broad trend remained weak, RSS4 in the Indian market rose for the third consecutive day on Thursday to its highest in almost a week tracking the up trend in the global market, but with subdued activities. Demand from the major natural rubber consuming sector stayed sluggish, keeping a lid on gains. In the ready market, the grade was quoted around Rs.161 a kg. In NMCE, following a gap-up opening, the most active January rubber futures was trading in narrow ranges and culminated the session 0.77 per cent higher.
Natural rubber in the overseas market are probably heading to culminate the week’s session on a positive note. TOCOM, SHFE as well as AFET rubber futures are seen stretching their earlier sessions’ gains on Friday in anticipation of improved demand from China. Advances in crude oil prices and weaker yen supported the sentiments too.
MARKET NEWS
Rubber output in Indonesia, the largest grower after Thailand, may decline for the first time in four years in 2013 as the country limits output and shipments in coordination with other producers to support a rally. Production may decline 8.9 percent to 2.77 million metric tons from an estimated 3.04 million tons this year, according to Agriculture Minister Suswono.
The rubber industry has sought lower import duty on raw materials such as butyl rubber and hi-tech synthetic rubbers, while it wants the duty on finished products to be kept high. A pre-Budget plea by the AIRIA, has asked for reduction in customs duty on natural rubber (NR) from the current 20 per cent or Rs 20 a kg to 7.5 per cent or Rs 10 a kg, whichever is lower.
According to Vietnam’s Ministry of Agriculture and Rural Development, 2012 rubber exports are seen at 1.02 million tonnes, up 25 per cent from an year earlier.
The Automotive Tyre Manufacturers Association has opposed imposing import curbs on natural rubber, saying that it will be counter productive.
TECHNICAL VIEW
RUBBER Jan NMCE
Inability to clear the resistance at 16500 saw prices edging lower in the previous session. Prices are currently hovering near the falling trend channel resistance and require breaking and sustaining the same for further upsides. Unsuccessful attempts to clear the same may call for turn-lower towards 16150 or more to 16040-15700 regions.
Source: Geojit Comtrade
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