MARKET COMMENTARY
⊳ Weak fundamentals continue to ponder upon the overall market sentiments. Despite disruptions in tapping in the major natural rubber growing areas in Kerala, burgeoning imports and muted demand from the tyre sector kept the prices in the bearish territory. Moreover, with Onam, the national festival of Kerala round the corner, activities are likely to slowdown. On Wednesday, RSS4 ruled steady in the physical market while NMCE rubber futures declined.
⊳In the overseas market on Thursday, natural rubber was trading largely steady to negative. TOCOM rubber futures dropped on strengthening yen and declining oil prices amidst worries over demand from China and supply glut as Thailand went ahead with its plans to off-load state stockpiles.
MARKET NEWS
⊳ Inventories in Qingdao, China’s main rubber trading hub, fall to 172,400 mt as of Aug. 29 from 188,000 on Aug. 15 according to Qingdao International Rubber Exchange Market.
⊳ Chanachai Plengsiriwat, managing director of Thailand’s Rubber Estate Organization, says the country signed an agreement last week to sell 100,000 tons of rubber and plans to sell a further 108,000 tons soon.
⊳ Rubber inventories in warehouses monitored by the Shanghai Futures Exchange rose 3.9 percent to 163706 tonnes last week.
⊳ Thailand’s National Council for Peace and Order is likely to delay the sale of 210,000 tonnes of rubber in state-owned stockpiles, caving in to rubber farmers who feared selling the stocks in one go would drive down prices.
⊳ Thailand’s National Council for Peace and Order has approved a budget of 5.94 billion baht for the overhaul of the rubber industry. The measures involve maintaining a stock to stabilise prices, improving planters’ liquidity, developing the rubber market and conducting research and development on rubber products.
⊳ Indonesian natural rubber production likely to miss target owing to prolonged wintering in certain rubber growing area in the country. According to Rubber Association of Indonesia, production may be 6.0% less than the target of 3.2 million tonnes.
TECHNICAL VIEW
RUBBER Oct NMCE
With prices trapped in a range of 12800-12400, a break out from the either side is mandatory for further directional move.
TURNAROUND
| Resistances | LEVELS | Supports |
| 12700/12800 | 13050-12800-12400 | 12500/12400 |
| 12950/13050 | 12200/12000 | |
| 13200/13350 | 11900-11850 |
Source: Geojit Comtrade
Download this report (full content – PDF file) here
