MARKET COMMENTARY
Action in the local natural rubber market continues to be muted. In the physical market, RSS4 continued to rule steady near Rs.127 a kg while NMCE rubber futures extended losses in volume less trades on Thursday. With Onam round the corner, activities are likely to slow down in Kerala, the major natural rubber producing state in India. In the mean time, natural rubber prices are declining sharply in the overseas market as the week’s session is culminating. SHFE rubber futures slipped to a seven week low. TOCOM rubber futures declined as well tracking losses in SHFE. Concerns over demand from China and supply glut continue to haunt the market.
MARKET NEWS
⊳ Thailand to increase area in which it will cut down aging trees by 33% to 400,000 rai (64,000 hectares) a year in season starting Oct., says Prasit Meadsen, acting director of Office of the Rubber Replanting Aid Fund.
⊳ Thailand’s Bank for Agriculture and Agricultural Cooperatives to lend 15 billion bhat to rubber farmer groups to build stockpiles and increase processing.
⊳ 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.
⊳ 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.
TECHNICAL VIEW
RUBBER Oct NMCE
While the broad trend stays negative, a break out from the either side of the range 12400-12800 is mandatory for further directional move.
TURNAROUND
| Resistances | LEVELS | Supports |
| 12650/12800 | 13050-12800-12400 | 12400/12200 |
| 12950/13050 | 12000 | |
| 13200/13350 | 11900-11850 |
Source: Geojit Comtrade
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