MARKET COMMENTARY
Sentiments slightly weakened in the local natural rubber markets on Monday, possibly tracking corrective moves in the major overseas natural rubber market. RSS4 grade rubber took a dip in the spot as well as futures market while latex (drc 60%) and certain other grades ruled flat. Sharp lower correction witnessed in TOCOM, AFET and SHFE exchanges weighed on prices. However, widening gap between local and international natural rubber prices amidst limited supplies may have provided firm support, restricting losses.
A mixed trend in being witnessed in natural rubber in the international market on Tuesday. While AFET and TOCOM rubber futures are seen inching up after falling the previous day, SHFE rubber futures extended the previous session losses. In TOCOM, the benchmark June rubber futures remained in the vicinity of eight month high though a rebound in yen and decline in Japanese vehicle sales weighed on.
MARKET NEWS
Japan’s motor vehicle sales dropped 3.4 percent to 212,429 units in December for a fourth month of decline, according to data released by the Japan Auto Dealers Association.
According to ANRPC, natural rubber consumption by China rose 6.4 per cent to 3.83 million tonnes, while in India gained 3.9 per cent to 995,000 tonnes during 2012. Production last year amounted to 8.06m tons, excluding data from Thailand during November and December and from Indonesia during June to December. That compared with total of 10.3m tons in 2011.
Rubber inventories in the warehouses monitored by SHFE rose 1.4 per cent to its highest since March 2010 to 99658 tonnes in the previous week.
According to the Rubber Board, India’s synthetic rubber consumption rose by 6 per cent to 2.26 lakh tonnes in the first half of this fiscal, while, production rose marginally to 54,778 tonnes during the period.
TECHNICAL VIEW
RUBBER Feb NMCE
The lower correction witnessed in the previous session was held near 16620 and brief pullback was seen there-off. Now, it requires clearing and sustaining the stiff resistance at 17100 convincingly for further upsides. As long as 17100 caps upside, trades with a mild negative bias towards 16500 regions may be seen, followed by a bounce back. However, slippage past the same may induce further weakness.
Source: Geojit Comtrade
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