Sheet rubber rules firm

Sheet rubber rules firm


Kottayam, Oct. 8

Physical rubber prices showed a mixed trend on Friday. Declines in the domestic rubber futures and a favourable change in weather during the day kept the buyers on sidelines.

According to market circles, most of them preferred to wait for a clear trend to emerge in the international scene after the weekend holidays.

Sheet rubber closed flat at Rs 1,74 a kg both at Kottayam and Kochi. Meanwhile, ISNR 20, the only gainer of the session, moved up further on short supply. The volumes were dull.

Futures weak

In futures, the October series weakened to Rs 176.25 (177.18), November to Rs 177.05 (178.94), December to Rs 180.25 (181.91) and January to Rs 183.30 (185.05) a kg for RSS 4 on the National Multi Commodity Exchange.

The volumes totalled 4106 lots and open interest 4514 lots. The turnover was Rs 74.30 crore. RSS 3 moved up at its October series to ¥310 (Rs 167.25) from ¥309.7 a kg during the day session but slipped to ¥309 (Rs 166.73) during the night session on Tokyo Commodity Exchange (TOCOM). RSS 3 (spot) increased to Rs 166.38 (165.29) a kg at Bangkok.

Spot rates were (Rs/kg): RSS-4: 174 (174); RSS-5: 167.50 (168); ungraded: 164 (164.50); ISNR 20: 171 (170) and latex 60 per cent: 116 (116).



Rubber in Tokyo Drops on Strong Yen; Shanghai Sets 2-Year High
Posted: 08 Oct 2010 05:29 AM PDT
By Aya Takada and Supunnabul Suwannakij

Oct. 8 (Bloomberg) -- Rubber in Tokyo retreated from a more than five-month peak after Japan’s currency surged against the dollar, weakening the appeal of yen-based contracts. Shanghai futures set a two-year high after a week-long holiday.

Futures in Tokyo dropped for the first time in four days, losing as much as 1.8 percent to 318.5 yen per kilogram ($3,871 a metric ton). The price had earlier gained to 326.5 yen, the highest price since April 21. Shanghai contracts surged to as much as 28,020 yuan ($4,200), the highest level since July 2008 as they resumed trade after the National Day holiday.

“The strengthening tone of the yen put pressure on the Tocom prices,” Sureerat Kunthongjun, an analyst at AGROW Enterprise Ltd., said by phone from Bangkok.

The yen yesterday gained to a 15-year high on expectations that the Federal Reserve will expand credit-easing steps and on prospects that Japan will avoid currency-market intervention before today’s meeting of finance ministers and central bankers from the Group of Seven industrialized nations. China’s stocks and commodities rose after retail sales surged during the holiday, adding to signs of the strength in the economy.

“Rubber was supported by speculation that Chinese buyers may step up purchases after the holiday,” Shuji Sugata, research manager at Mitsubishi Corp. Futures Ltd., said today by phone. “Futures in Tokyo were sold because of a stronger yen and a slump in industrial commodities overnight.”

The March-delivery contract fell 0.5 percent to settle at 322.7 yen on the Tokyo Commodity Exchange, also known as Tocom. The March contract on the Shanghai Futures Exchange gained 2.9 percent to close at 27,655 yuan.

Dollar Slumps

The dollar traded near the lowest level since 1995 against the yen on burgeoning speculation the Federal Reserve will debase its currency by stepping up purchases of government debt to support the economic recovery.

The dollar stood at 82.45 yen at 4:14 p.m. in Tokyo from 82.41 yen in New York yesterday when it touched 82.11 yen, the lowest since May 1995.

U.S. private nonfarm payrolls rose by 75,000 in September after an increase of 67,000 in the previous month, according to the median forecast of 60 economists in a Bloomberg News survey before today’s report from the Labor Department. The jobless rate is expected to increase to 9.7 percent from 9.6 percent.

The Shanghai Composite Index, which tracks the bigger of China’s stock exchanges, rose 3.1 percent to 2,738.74.

The auctioned price of ribbed smoked sheets in Thailand dropped 0.3 percent to 105.89 baht ($3.52) a kilogram tracking lower crude oil prices, the Rubber Research Institute of Thailand said on its website today.

(bloomberg.com)





Merchant Hedge Fund Founders Coleman, King Buy Singapore Rubber Trader
Posted: 08 Oct 2010 05:28 AM PDT
Michael Coleman, who co-manages the $1.3 billion Merchant Commodity Fund, and his partner Doug King have bought a stake in a Singapore-based rubber trader, which had sales of about $1 billion last year.

The two former Cargill Inc. traders control a company called Kincol Pte Ltd., which purchased 60 percent of RCMA Commodities Asia Pte Ltd., Coleman, 49, and King, 43, said in separate interviews yesterday. Chris Pardey, also a former Cargill trader, is a shareholder in Kincol and becomes chief executive officer of RCMA, they said.

The Merchant Commodity Fund, which invests in agriculture and energy, returned 12.7 percent in September and is heading for its seventh straight annual gain since starting in 2004, according to three people with direct knowledge of the matter. Rubber, used in tires, jumped 52 percent in the past year on the Tokyo Commodity Exchange as demand led by China, the top consumer, outpaced supply from Thailand, Indonesia and Malaysia.

“With China’s growth in vehicles and infrastructure requirements, rubber will be a critical commodity,” Zug, Switzerland-based King said. “We see it as strategic.”

The purchase was a personal one, and not related to the fund, Coleman and King said, declining to say how much they paid.

The acquisition gives the two fund managers access to supply, demand and logistics in the global rubber trade as RCMA operates in China and the U.S. The firm also has an office in the Netherlands and provides warehousing and transport services, according to its website.

Trading Roots

Kincol has an agreement to buy the balance of RCMA “over the course of the next few years,” Coleman said. The stake was bought from Oei Hong Bie, whom Coleman has known for 26 years since he first came to Singapore, he said. Oei continues to hold “a significant stake” in the trading firm, its website said.

Pardey left Barclays Capital earlier this year where he was global head of agricultural products, coal and freight. RCMA has more than 70 staff, Coleman said.

“Our ambition is to build a strong commodity trading/ supply-chain management company, not limited to agriculture,” said Coleman, who was head of global rubber trading at Cargill. “Our roots are in physical commodity trading,” he said. King was Cargill’s head of global petroleum trading and ran U.K. grain trading.

The Merchant Commodity Fund managed $1.3 billion at the end of September, King said. The fund’s gain last month took this year’s return after deduction of fees to 7.5 percent, according to the three people with knowledge of the numbers.

Rubber futures in Tokyo dropped 0.7 percent to 321.9 yen a kilogram ($3,912 a metric ton) as of 12:20 p.m. local time.
(bloomberg.com)





Indian tyre makers to import over 30,000 T rubber Oct-Dec
Posted: 08 Oct 2010 05:26 AM PDT
ndian tyre makers will import over 30,000 tonnes natural rubber in Oct-Dec and are also looking for similar quantities for Jan-March delivery, as rising demand outweighs higher international prices, industry players said.

That would put total imports for this fiscal year close to the 170,679 tonnes of 2009/10, when India's needs nearly doubled as domestic production was hit by a severe drought.

"Tyre makers have already signed deals for 30,000 tonnes of rubber imports because of the difference between domestic and international prices. In Thailand rubber was cheaper when they contracted," a dealer based in Kochi, in the southern state of Kerala, said.

In August, Indian rubber makers were charging a premium of as much as 35 rupees ($0.79) per kilogramme (kg) over the Bangkok market, prompting Indian tyre companies to buy rubber from overseas markets.

"Despite duty, overseas rubber was cheaper. Now the gap between domestic and international markets has come down, but tyre makers are likely to import to cater to their rising demand," the dealer said.

The world's fourth-biggest natural rubber producer currently charges 20 percent duty on the imports. India's imports between April-September stood at 107,190 tonnes, down 12 percent compared to 122,095 tonnes a year ago.

On Thursday, the Indian price was over 8 rupees higher per kg than Bangkok market, data with the state-run Rubber Board showed.

"Tyre companies will wait for the government to cut import tax on rubber and afterwards again they will start placing orders," said another dealer.

India may cut the tax on rubber imports to 20.46 rupees per kg from the current 20 percent levy, a government policy adviser said last month.

India's natural rubber production in 2010/11 is likely to fall short of the estimated 893,000 tonnes due to adverse weather conditions, Sajen Peter, chairman of the Rubber Board, said on Wednesday.

The Rubber Board estimates consumption in the country will rise by 5 percent to 978,000 tonnes in 2010/11.

"(Indian) tyre companies are inquiring for imports in first quarter of 2011. They want to contract before prices rise further," said a leading rubber exporter based in Thailand, the world's biggest exporter of natural rubber.

The global rubber market could see two years of tighter supplies and rising prices as output sputters while producers replace ageing trees and demand drives higher in a worldwide recovery, conference delegates said.

Tokyo rubber futures rose further on Thursday, hitting a five-month high on the back of tight supply in producing countries, but the gains were limited by the strength of the Japanese yen, dealers said.

(1$=44.2)
(moneycontrol.com)



India revises down rubber output projection
MUMBAI (Commodity Online): Rubber Board of India has revised down its natural rubber output estimation for this fiscal due to unpleasant weather condition in Kerala, a major production region in the country.

Rubber Board Chairman, Sajan Peter on Wednesday said that the production is likely to be down than its earlier projection of 893,000 tons.

However, the output is expected to be 5% higher than the previous year, he added. India produced 831,000 tons of natural rubber in 2009-10.