By Gautami Koli
MUMBAI – The December contract of rubber on Indian Commodity Exchange ended higher due to bargain buying by market participants after prices hit a three-month low of 12,035 rupees per 100 kg on Tuesday, analysts said.
The December contract ended at 12,280 rupees per 100 kg, up 125 rupees from Tuesday.
However, the overall sentiment in the market remains bearish, tracking weakness in benchmark contracts on Tokyo Commodity Exchange, and due to a fall in prices of natural rubber in key spot markets of Kerala, traders said.
Rubber futures on TOCOM fell today because of an overnight fall in crude oil prices on New York Mercantile Exchange, which fell due to concern over oversupply and weak demand outlook, analysts said.
Prices of rubber take cues from those of crude oil as it is used to produce synthetic rubber, a substitute for natural rubber.
Crude oil contract on NYMEX hit a one-year low of $54.75 a barrel on Tuesday.
The most-active April contract of rubber on the Japanese bourse was down 0.4% at 159.1 yen (100.99 rupees) per kg.
As of today, inventory of the commodity at Shanghai Futures Exchange-warehouses rose to 487,060 tn, compared with 484,640 tn on Tuesday.
In Thailand, the RSS-3 grade rubber was up 44 cents at $134.83 per 100 kg and in Malaysia, the SMR-20 grade was unchanged at $123.9 per 100 kg, according to data released by the Rubber Board of India.
Meanwhile, rubber prices in spot markets of Kerala fell today due to subdued demand from tyre manufacturers, said C.J. Augustine, a trader.
There is less demand in domestic market as buyers have imported rubber from different countries, he added.
In the spot markets of Kerala, the widely-traded RSS-4 variety of rubber was sold at 119-122 rupees per kg today, down 1-2 rupees, traders said.
According to a data from the Rubber Board of India, the RSS-4 variety was sold at 121.50 rupees per kg in both Kochi and Kottayam, down 50 paise from Tuesday.
Today’s closing prices of rubber, in rupees per kg, at Kottayam and Kochi, as detailed by the Rubber Board, and the change in prices, in rupees, compared with the previous close are given in the following table:
| KOTTAYAM | KOCHI | |||
| GRADE | PRICE | CHANGE | PRICE | CHANGE |
| RSS-4 | 121.50 | (-) 0.50 | 121.50 | (-) 0.50 |
| RSS-5 | 116.50 | (-) 0.50 | 116.50 | (-) 0.50 |
| ISNR-20 | 111.00 | Unch | NA | NA |
| Latex | 82.40 | Unch | NA | NA |
OUTLOOK
Prices of natural rubber in key spot markets of Kerala are expected to remain steady as expectation of a rise in demand from tyre manufacturers is likely to cushion the downtrend. End
US$1 = 72.32 rupees
Edited by Mainak Moitra
