MARKET COMMENTARY
Sentiments were mixed in the local natural rubber market on Tuesday. In the physical market, RSS4 grade rubber was quoted around Rs.157 a kg at its weakest in about 34-months. In the mean time, NMCE rubber futures steadied following the previous session declines probably supported by gains in the overseas market. The broad trend stayed weak. Amidst increasing natural rubber production and stocks, off-take by the tyre manufacturers remained sluggish pressurizing prices to move south. Stocks in NMCE accredited warehouses are at its highest since April 2011.
Natural rubber in the overseas market is seen rising on Wednesday. Gains in crude oil prices along with optimism over global economic growth lifted prices. Weaker yen aided TOCOM prices. In the physical market, prices were buoyed by Chinese buying ahead of the lunar holidays. Moreover, top producers, Thailand and Malaysia are about to enter the lean production phase. However, higher stocks in the top consumer weighed on the sentiments.
MARKET NEWS
According to Rubber Trade Association of Japan, crude rubber inventories in the Japanese ports fell by 202 tonnes to 6934 tonnes in the 10 days to January 10 from a four month peak marked at the end of 2012
According to Vietnam’s General Statistics Office, the nation shipped 117,000 tons of rubber in Dec., up 11% from previous assessment of 105,000 tons.
TOCOM January rubber futures expired with 124 lots being delivered compared to 288 lots being delivered in December.
Rubber inventories in the warehouses monitored by SHFE fell 3.3 per cent 98007 tonnes in the previous week. According to reports, the decline is largely owing to storage regulations that forced some merchants to withdraw stocks.
According to IRSG, Production is set to outpace consumption by 179,000 metric tons this year and 153,000 tons in 2014.
According to AIRIA, rubber imports into India in January and February are likely to fall further on a sharp drop in local prices in the past three months due to lower December shipments.
TECHNICAL VIEW
RUBBER Feb NMCE
Broad Trend: Weak
Near Term: Requires clearing 15900 to stretch the bounce back towards 16050 or more to 16250.
TURNAROUND
|
Resistances |
LEVELS |
Supports |
|
15800/15900 |
15900-15500 |
15540/15260 |
|
16050/16240 |
|
15100/14950 |
|
16400/16540 |
|
14700/14500 |
Source: Geojit Comtrade
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