MARKET COMMENTARY
Tanking crude oil prices coupled with weak seen in the major overseas market dragged lower the natural rubber prices in the local market on Tuesday. RSS4 in the physical market slipped to Rs.127.50 a kg, while the Rubber Board’s reference rate stayed at Rs.130.75 a kg. NMCE rubber futures retreated from more than a four month high, shedding about two per cent. In the meantime, natural rubber prices continued to decline in the overseas market on Wednesday. TOCOM and AFET rubber futures extended the previous session losses, while SHFE rubber futures fell on worries over the global economic outlook.
MARKET NEWS
⊳According to International Rubber Study Group, global natural rubber demand in 2015 is anticipated to increase 3.1 per cent to 12.3 million tonnes.
⊳Thai Prime Minister says government trying to boost natural rubber prices to 65 baht a kg without providing details on ways to prop-up prices.
⊳Natural rubber production in India tumbled 36 per cent in December to 63000 tonnes on YoY basis. Consumption declined as well by 1.8 per cent to 83500 tonnes while imports rose 8.0 per cent during the same time.
⊳Crude rubber inventories at Japanese ports stood at 12,987 tonnes as of Dec. 20, up 15.1 pct from 10 days earlier, data from the Rubber Trade Association of Japan showed.
⊳According to Union Commerce Minister the period for the export of rubber imported under the advanced licensing system has been reduced to six months from the earlier 18 months.
⊳According to media reports, tyre companies have procured about 2400 tonnes of rubber under the new formula implemented by the State government recently.
⊳Monsoon floods seen curbing Malaysian natural rubber output and expects 2015 natural rubber production to be at 700000 tonnes.
⊳According to International Rubber Consortium, natural rubber production from Malaysia and Thailand is to drop at least 30 per cent if floods in Northern Malaysia and Southern Thailand persist.
⊳According to Indonesian Rubber Association, natural rubber exports from the country is likely stay unchanged from the current levels at 2.5 million tonnes in 2015
⊳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.
TECHNICAL COMMENTRY
RUBBER Feb NMCE
With the previous session sell-offs, prevailing positive bias is waning off and a direct fall below 12500 is likely to see another round of liquidation towards 12250/12100 ranges. However, a rise over 12850 could rejuvenate the positive momentum.
Source: Geofin Comtrade
