* Thai RSS3 traded at $2.53-$2.56/kg for November
* Rumours that China will stockpile rubber again
* SIR20 sold at 106.50-107.50 cents/lb; SMR20 at $2.44/kg
By Lewa Pardomuan
SINGAPORE, Oct 9 (Reuters) – Main rubber consumer China snapped up tyre grades for nearby shipment as traders there returned to the physical market after a holiday, heightening speculation the country will stockpile the commodity again, dealers said on Wednesday.
China, which accounts for 35 percent of global consumption, announced last year it would buy up to 200,000 tonnes of rubber from the domestic market to support prices but dealers said only a fraction was purchased by the end of 2012.
Some dealers speculated China would aim to stockpile that same amount of rubber this year, probably buying about 50,000 tonnes from the overseas market and the rest locally. China’s rubber output may rise 7.5 percent to 855,000 tonnes in 2013, according to the Association of Natural Rubber Producing Countries.
“We’ve seen buyers from Singapore and China around. China’s stockpiling plan will stir up the market,” said a dealer in Thailand, the world’s largest producer.
China mainly buys natural rubber from Thailand, Indonesia, Malaysia and Vietnam. Imports rose 8.48 percent to 1,486,919 tonnes in January to August this year compared with the same period in 2012.
Thai RSS3 rubber was traded late on Tuesday at $2.53 to $2.56 a kg for November delivery and at $2.56 to $2.59 for December, higher than $2.49 last week.
Another Thai grade, STR20, was sold at $2.40 to $2.44 a kg versus $2.37-$2.45 last week.
“China keeps on buying this week, but we don’t know about the quantity of rubber to be used for stockpiling,” said a dealer in Singapore. “Normally, China would be buying rubber from the domestic market for stockpiling purposes.”
Chinese buyers have increased their presence in the physical market in recent weeks, sparking speculation the government may announce the stockpiling plan soon. China is also seen replenishing stocks following a drop in the inventory in Qingdao.
However, benchmark Tokyo rubber futures tracked the Nikkei share index lower on Wednesday, having risen more than 3 percent in the previous session on speculation that China would buy the commodity. The Tokyo market, which sets the tone for tyre-grade prices, often tracks movements in equities and currencies.
Indonesia’s SIR20 rubber changed hands at 106.50 to 107.50 U.S. cents a pound ($2.34 to $2.41 a kg) for November shipment, higher than last week’s offer prices of 104.25 to 104.75 U.S. cents.
The buyers were trading houses in Singapore, which usually ship rubber to China.
Malaysia’s SMR20 was traded at $2.44 a kg, higher than last week’s offer prices of $2.38 to $2.40.
WEEK AHEAD
Tyre grade prices could rise further next week as China replenishes stocks after the holiday.
(Editing by Alan Raybould)
Source: Reuters
