MARKET COMMENTARY
⊳Uptrend continued in the Indian natural rubber market. On Tuesday, spot prices for RSS4 grade rubber inched higher on expectations of improvement in demand from the tyre sector following the accord reached with tyre companies by the state government regarding buying natural rubber locally by the former and full exemption of value added tax for natural rubber until March next year. On NMCE, the commodity tested a four month high before settling nearly two per cent high. In the mean time, Rubber Board has fixed the rates for RSS4 at Rs.130 a kg.
⊳ On Wednesday a mixed trend is being witnessed in the international market. While natural rubber resumed rising in SHFE following the previous day’s decline, TOCOM and AFET rubber futures declined. Benchmark June rubber futures on TOCOM declined nearly two per cent as it reopened today after the holiday.
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.
TECHNICAL COMMENTRY
RUBBER Jan NMCE
Even as there exist positive sentiments, it requires clearing the immediate hurdle of 12750 for extension of the previous day’s up-moves to 12850-13000 ranges. Inability to do so could call for profit booking possibly towards 12500/12350 levels.
Source: Geofin Comtrade
