MARKET COMMENTARY
⊳NMCE rubber futures jumped on Thursday following the outcome of meeting of Kerala Chief Minister with major tyre companies. In the meeting it was decided that tyre companies would buy rubber from the local market by paying 25 per cent above prices fixed by the Rubber Board considering rubber prices in the international market till this fiscal year-end. The most active January rubber futures ended 3.5 per cent higher to hit a five week high. Spot prices gained as well.
⊳As the week’s session culminates, natural rubber in the international market edged down. TOCOM rubber futures inched lower though it stayed in the vicinity of the one month high hit the other day. Sentiments were mixed. While a weak data from China weighed on, worries of supplies emerged owing to floods in the top natural rubber producing country Thailand
MARKET NEWS
⊳ The Kerala government today approved a formula to help rubber farmers after holding discussions with 12 tyre manufacturing companies in the country. As per the formula, companies would purchase natural rubber at a price fixed by Rubber Board considering the international price of natural rubber plus 20 per cent customs duty and five per cent purchase tax.
⊳Natural rubber production in India in November declined 25 per cent on year on year basis to 64000 tonnes while consumption and imports rose 12 per cent and 19 per cent to 85000 tonnes and 33156 tonnes respectively.
⊳China to raise the cap for rubber import tariff to 1500yuan a tonne from the present 1200 yuan a tonne with effect from January 01.
⊳Indian Rubber Growers Association has urged an urgent intervention of the state and the central government to initiate steps to save rubber growers. In the mean time, the growers association comprising UPASI, APK, IRGA etc have filed a petition under the Provisions of Safeguard before the Directorate of Safeguards, New Delhi to protect the domestic rubber growers from un-controlled and unrestricted imports.
⊳Kerala State Finance Minister in a letter to the Union Commerce Minister has sought Rs.1000 crore from the Center’s Price Stabilization Fund to provide relief to the rubber growers.
⊳Malaysian Plantation Industries and Commodities Minister says Malaysia, Indonesia and Thailand are doing what it takes to ensure production does not exceed current world demand for rubber and urged ANRPC members to hold a ministerial level meeting.
⊳Thai government and at least 7 exporting companies plan to form fund worth more than 400m baht to buy rubber on Agricultural Futures Exchange of Thailand according to PongsakKerdvongbundit, managing director of Von Bundit.
TECHNICAL COMMENTRY
RUBBER Jan NMCE
12050 poses to be immediate resistance, which if cleared could call for 12250 or more to 12500. A fall below 11540 will again induce weakness.
Source: Geofin Comtrade
