MARKET COMMENTARY
Sentiments stayed rather bleak in the local natural rubber market on Monday. RSS4 was hovering near its lowest level since early 2010 as poor demand from the tyre sector, higher imports and bear trend in the overseas natural rubber market weighed on. On the futures segment too, the commodity was seen slipping with the most active September rubber futures on NMCE shedding nearly one per cent. In the meantime, natural rubber prices in the major international market took a pause after the recent declines. TOCOM rubber futures are seen inching up and so are SHFE and AFET rubber futures. Reports that global rubber surplus may contract in coming year as lower rubber prices may encourage farmers to reduce tapping improved the overall market sentiments. Currently, natural rubber prices in the top natural rubber producing country Thailand, is languishing near its weakest level since July 2009.
MARKET NEWS
⊳ The global surplus of natural rubber will shrink 46 percent in 2015 as demand expands and farmers reduce tapping because of decreasing prices, according to the International Rubber Study Group.
⊳ Rubber Board Chairman Ms. Sheela Thomas has been appointed as the Secretary General of the Association of Natural Rubber Producing Countries (ANRPC).
⊳ Thailand plans to reduce plantation area by 100,000 rai (16,000 hectares) a year for 7 years, according to the Office of the Rubber Replanting Aid Fund.
⊳ Global natural rubber output from key growers shrinks to 5.83m mt in first seven months from yr-ago period according to Association of Natural Rubber Producing Countries.
⊳ Natural rubber imports by India in July rose 14.8 per cent to 36997 tonnes on YoY basis, according to the Rubber Board.
⊳ Thai Ministry of Agriculture and Agricultural Cooperatives to ask the Natural Rubber Policy Committee this Friday for 30 billion baht budget to increase the utilisation of natural rubber from 10 percent to 30 percent of four million tonnes of annual yield.
⊳ Thailand’s military government to encourage farmers in the world’s biggest rubber producer and exporter to cut down more rubber trees in a bid to restrict supply to help shore up prices.
TECHNICAL VIEW
RUBBER Sep NMCE
Inability to clear the resistance at 13050 saw prices retreating in the previous session. For the day, weakness is likely to persist and slippage past 12750 may see prices testing 12500-12400 or even more. However, an unanticipated rise over 12950 may attract some short covering.
TURNAROUND
| Resistances | LEVELS | Supports |
| 12800/12950 | 13500-13280-12800 1 | 2750/12650 |
| 13050/13150 | 12500/12400 | |
| 13280/13350 | 12200-12150 |
Source: Geojit Comtrade
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