KUALA LUMPUR — The Malaysian rubber market is expected to rebound next week on fresh demand and on expectations of increasing oil prices,as well as cautious trading in the ringgit against the US dollar moving forward, a dealer said.
He said the price movements were also expected to be influenced by the performance of the Tokyo Commodity Exchange.
The dealer said oil prices influenced rubber prices as their rise and fall would determine the pricing of natural rubber’s competitor, synthetic rubber.
“The market is expected to rebound as players may take advantage of the lower price this week,” he added.
The market is also expected to be supported by recovering oil prices, boosted by a stronger-than- expected inventory draw in the US and earnest pledges by leading producers in the Middle East to cut supplies to the global market.
JAPAN’S HIGHER INVENTORY
He said, however, gains may be capped by Japan’s higher rubber inventory data as reported by the Rubber Trade Association of Japan (RTAJ).
The RTAJ saw inventories at Japanese ports standing at 7,592 tonnes as of July 20, up 12.9 per cent from the last inventory date.
For the week just-ended, rubber prices were mostly lower, tracking losses on the TOCOM due to the stronger yen against the US dollar, as well as other regional futures markets.
The market started off the week lower, before rebounding slightly on Tuesday, but retreated for almost the rest of the week.
On a Friday-to-Friday basis, the Malaysian Rubber Board’s official physical price for tyre-grade SMR 20 slipped 36 sen to 621.5 sen a kg from 657.5 sen a kg, and latex-in-bulk declined eight sen to 506 sen a kg from 518 sen a kg.
The 5 pm closing price for tyre-grade SMR 20 was 58 sen lower at 603.5 sen a kg, and latex-in-bulk dipped 15.5 sen to 502 sen a kg.
