Spot rubber prices remain unchanged

Spot rubber prices remain unchanged
Aravindan

Kottayam, July 13

Spot rubber finished unchanged for the third consecutive day on Tuesday. Declines in the domestic and international futures took the steam out of the market and sheet rubber closed steady at Rs 185 amidst dull volumes. The NMCE rubber futures were generally bearish in line with the global markets.

Futures mixed

The highly traded August 2010 series saw a high of Rs 181.49 and a low of Rs 178 a kg. The total volume was 8,260 lots and the turnover Rs 148.05 crore. The total open interest in all series was 5,111. The July series improved to Rs 189.75 (188.76) while the August series weakened to Rs 179.40 (181.22), September to Rs 171.15 (173.31) and October to Rs 166.55 (167.67) a kg for RSS 4.

On the Tokyo Commodity Exchange, RSS 3 declined with the July futures slipping to ¥344.4\Rs 182.37 (¥350.8), August to ¥ 302.7 (¥ 310.0), September to ¥290.8 (¥ 298.5), October to ¥ 274.4 (¥280.7), November to ¥263.6 (¥269.7) and December to ¥260.1 (¥265.5) a kg during the day session. RSS 3 (spot) fell to Rs 159.37 (162.59) a kg at Bangkok.

Spot rates were (Rs/kg): RSS-4: 185 (185); RSS-5: 180 (180); ungraded: 175 (175); ISNR 20: 162 (162) and latex 60%: 128 (128).



Rubber Drops for Third Day on China Demand Concern, Thai Supply
Posted: 13 Jul 2010 01:18 AM PDT
By Supunnabul Suwannakij

July 13 (Bloomberg) -- Rubber tumbled for a third day to the lowest level in more than a month on concern that slower car sales growth in China may signal weaker demand, while supplies from Thailand increased.

Futures in Tokyo declined as much as 2 percent to the lowest level since June 10. The price dropped 3.9 percent in the past two sessions after data showed car sales growth in China slowed, raising concern that consumption may weaken in the largest consumer of the commodity used to make tires.

“The market was following yesterday’s sentiment, pressured by slow car sales growth in China,” Kazunori Kokubo, general manager of the international business department at commodity broker Yutaka Shoji Co., said by phone from Tokyo.

Sales of cars, sport-utility vehicles and multipurpose vehicles in China, the largest auto market, expanded 19 percent from a year earlier to 1.04 million units last month, the China Association of Automobile Manufacturers said on July 9. That was the slowest pace since March 2009.

December-delivery rubber lost as much as 5.4 yen to 260.1 yen per kilogram ($2,932 a metric ton) before trading at 262.4 yen on the Tokyo Commodity Exchange at 11:30 a.m. local time. Still, prices have gained 71 percent over the past year.

November-delivery rubber on the Shanghai Futures Exchange lost 2.2 percent to 21,325 yuan ($3,147) a ton.

Car Sales

China’s passenger-car sales have risen every month since February 2009 after the government halved the consumption tax on small vehicles to 5 percent the preceding month as part of a stimulus package. Vehicle demand surged 46 percent to 13.6 million units last year, surpassing the U.S. for the first time.

The small-car sales tax was raised to 7.5 percent this year, and June was the third straight month of slowing demand. Monthly sales may decline from year-earlier levels during the second half of 2010, Credit Suisse Group AG analysts Adrian Chan and Hung Bin Toh wrote in a report on May 26.

“Improved supply from southern Thailand, amid an absence of orders from China, also damped market sentiment,” said Chaiwat Muenmee, an analyst at Bangkok-based commodity broker DS Futures Co. An average of 300 metric tons a day of ribbed smoked sheet was traded in Thailand’s southern markets this month, compared with more than 100 tons a day last month, Chaiwat said.

In the cash market, the Thai benchmark price dropped 0.4 percent to 112.35 baht ($3.47) per kilogram yesterday, according to the Rubber Institute of Thailand.

China’s natural-rubber inventories rose 3,429 tons to 19,411 tons, the bourse said on July 9, based on a weekly survey of 10 warehouses. It was the second straight increase after reaching the lowest level since January 2003.

(bloomberg.com)





Rubber Futures in Tokyo Tumble as Much as 2% to 260.1 Yen/Kg
Posted: 13 Jul 2010 01:16 AM PDT
By Supunnabul Suwannakij

July 13 (Bloomberg) -- Rubber futures in Tokyo declined as much as 2 percent, extending yesterday’s slump on concerns that a slow global economic recovery may weaken demand. The December- delivery contract fell to 260.1 yen per kilogram before trading at 260.4 yen as of 10:34 a.m. local time.

(bloomberg.com)





Growing rubber demand to make imports a must
Posted: 13 Jul 2010 01:13 AM PDT
Kochi: A less than desirable growth in planting and re-planting of natural rubber is leading to a situation where India will be forced to import to meet its increasing appetite for the commodity. For the fourth consecutive year, domestic consumption of natural rubber has outstripped production and the gap is seen widening, say officials of Automotive Tyre Manufacturers Association (Atma).

It is projected that natural rubber consumption is expected to go up approximately by 12-15% in the current fiscal, while production increase is likely to be only 5-6%, leading to a deficit of 1,76,000 tonne, which is more than double the projections of the Rubber Board.

A study carried out by the International Rubber Study Group (IRSG) says that India is the only nation that is likely to consume rubber at a faster rate.

“Consumption in the US is expected to dip in the short and long run, while the same in Japan and Germany will remain flat. The largest consumer, China, will slow down in coming days but will still retain the pole position,” sources at IRSG said.


The per capita consumption in India still lags the global standards, so the potential for growth is more.

According to Atma sources, though the area under production is showing a rising trend, the incremental increase in area is on the decline. During the previous financial year, only 3,000 hectare was added to tapping area as against 19,982 hectare during 2003-04.

India’s share of total planted area among the members of the Association of Natural Rubber Producing Countries (ANRPC) has remained almost flat –– from 7.5% during 2005 to 7.8% during 2009.

The rubber sector is concerned about uneconomic land holdings, dependence on a single clone and limitations of non-traditional areas. The traditional area of rubber farming in Kerala accounts for 92 % of natural rubber production, and experts feel that it is saturated. Kerala does not have fresh land for rubber cultivation.

The Rubber Board is relying on the north-eastern states for increase in output. Atma claims that the area under plantation in these states is significantly lower than the potential. The potential area there is approximately 4, 50,000 ha while the area covered is just 16% or 71,840 ha.

However, some feel that although land is available in the region, the cold climatic condition of the Northeast is not conducive to rubber. ...

(financialexpress.com)





Elgi Rubber merges with Treadsdirect
Posted: 13 Jul 2010 01:11 AM PDT
The board of Coimbatore-based Elgi Rubber Company Ltd has approved proposals to amalgamate the company with Treadsdirect Ltd with effect from April 1, 2010.

The company said on Monday that it plans to restructure the company's business through a composite scheme of arrangement and amalgamation with the latter company to form Elgi Rubber International Limited, which is to be eventually listed on the National Stock Exchange.

The board also approved de-merging certain divisions of Treadsdirect Ltd to Treadsdirect (India) Limited, which would operate as a wholly-owned subsidiary company of Elgi Rubber International Limited.

It has constituted a committee of directors, the Amalgamation and Restructuring Committee, to determine the swap/share entitlements and to finalise and approve the composite scheme of arrangement and amalgamation.

(business-standard.com)