MARKET COMMENTARY
Natural rubber prices dwindled in the Indian market pressured by a weak demand. On Monday in the physical market, RSS4 grade rubber touched its weakest since late-March 2010. In the futures market too prices inched lower with the most active March rubber futures ending 0.68 percent down from the previous close. Despite a dip in natural rubber output in the peak production month of January, fall in consumption, rising stockpiles along with slowing auto sales in the country continued to build pressure on prices to move south. Yet, natural rubber prices in the overseas market being at a premium to local prices and upcoming lean production season are likely to provide cushion to falling prices.
TOCOM exchange reopened today after an extended weekend holiday and the benchmark July rubber futures is seen rising following an initial dip supported by a weaker yen. AFET rubber futures are seen rising too. However, burgeoning stockpiles in China raised concerns over demand from the top consumer.
MARKET NEWS
According to the Society of Indian Automobile Manufacturers India’s car sales and commercial vehicles sales dropped by 12.44 and 9.51 percent respectively in January.
According to Rubber Board, India’s natural rubber production declined by 5 per cent to 97,000 tonnes in January, while consumption fell by 9 per cent to 75,000 tonnes.
Rubber inventories in the warehouses monitored by SHFE rose 1.2% to 100015 tonnes.
Natural rubber imports by China rose 19 per cent in January to 250000 tonnes on MoM basis.
According to Rubber Board, India’s synthetic rubber consumption rose by 17 per cent to 36,710 tonnes in October last year while the production rose by 5 per cent to 9,006 tonnes during the period.
According to Association of Natural Rubber Producing Countries, rubber imports by the top consumer China surged 18 per cent during 2013 to 3.37 million tonnes.
According to Malaysian Rubber Board, natural rubber output may expand 6.5 per cent in 2013 on improving yield and higher prices.
TECHNICAL VIEW
RUBBER Mar NMCE
Broad Trend: Bearish
Near Term: Requires clearing resistance near 16250 levels to lessen the prevailing weakness.
TURNAROUND
|
Resistances |
LEVELS |
Supports |
|
15850/15960 |
16250-15500 |
15640/15500 |
|
16050/16250 |
|
15380/15260 |
|
16400/16540 |
|
15100/14900 |
Source: Geojit Comtrade
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