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MARKET COMMENTARY
With the major overseas natural rubber markets remaining closed, it was relatively a quiet trading session on the New Year day yesterday in the physical as well as futures market. In NMCE, the most active February rubber futures varied in very narrow ranges and culminated the session a tad down. In the spot market, RSS4 inched lower to Rs.161/kg though the activities remained subdued as a holiday mood prevailed in the market. The demand from the tyre sector remained subdued. However, thin supplies to market provided lower level support to prices. According to sources, growers are holding back their produce in anticipation of higher prices in coming weeks.
AFET reopened today while the major TOCOM and SHFE will be reopening only on Friday, 04 Jan after the New Year holidays. The most active August rubber futures in AFET climbed over two per cent probably tracking gains in crude oil and other industrial commodities as concerns over the US fiscal cliff subsided.
MARKET NEWS
A meeting was held between Prof. K.V. Thomas, Minister of State (Independent Charge) for Consumer Affairs, Food and Public Distribution and Anand Sharma, Minister for Commerce, Industry and Textiles, Friday in New Delhi to review fall in domestic price of natural rubber in the month of December, 2012. ⊳Rubber inventories in the warehouses monitored by SHFE rose 0.6 per cent to 98280 tonnes.
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.
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.
TECHNICAL VIEW
RUBBER Feb NMCE
A sideways movement in narrow ranges was witnessed during the previous session after retreating from 16950 regions earlier this week. 16500 regions is likely to act as a firm support below which prices are likely to edge lower towards 16400-16300 levels or even more. Else a pullback towards 16800-16960 may be seen but requires clearing the congestion region of 16960-17070 for further upsides.
Source: Geojit Comtrade
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