NMCE Rubber settles higher on fresh buying

NMCE Rubber settles higher on fresh buying
Posted: 07 Feb 2011 05:19 AM PST
NMCE rubber futures showed a smart recovery on fresh buying on previous day’s losses. Futures started the day on lower note on extended selling pressure. However, overall buying interest pushed the prices on higher side.
TOCOM futures also closed higher on Friday at ¥501.60 per Kg. Indian spot market have also resumed its bullish trend. Sellers are not ready to sell at current level because of prevailing difference in domestic and international prices. Thus, on cues from above stated factors rubber futures traded higher and ended on positive note.
The rubber futures are projected to trade lower on active selling on Monday. Spot rubber also witnessed a down trend on Saturday which may further pressurize the prices at futures also.
TOCOM rubber July futures are trading lower at ¥496.20 per Kg. Crude oil prices are also expected to trade lower on cues from data releases from Euro zone. Thus, on cues from international and domestic market futures are likely to trade down today.
Factors to Watch For
Shanghai market will be closed From February 6th to February 8th due to Lunar New Year
According to Malaysian Meteorological Department, The La Nina weather event is having a major impact on palm oil and rubber production in Malaysia as heavier rainfall may hamper harvesting and tapping
According to the Rubber Research Institute of Thailand, The physical price of natural rubber in Thailand advanced to 180.55 baht ($5.84) a kilogram yesterday from 178.55
According to the Association of Natural Rubber Producing Countries, Natural-rubber consumption in China may rise 9% to 3.6 million tons this year and India’s consumption may gain 5.2% to 991,000 tons
According to China Association of Automobile Manufacturers, Car-sales growth in China will be around 10 to 15 percent this year Total auto sales, which include cars, trucks and buses, jumped 32 percent last year to 18.06 million
DERIVATIVE ANALYSIS
Indian Futures (NMCE)
The NMCE February contract, prices and open interest are rising while volumes are falling. It indicates market is attracting late buyers & early shorts; market is vulnerable to a sharp correction but likely that that correction will be bought creating a buy point for uptrend.
Japan Futures (TOCOM)
The TOCOM active June contract, prices and open interest are rising while volumes are falling. It indicates market is attracting late buyers & early shorts; market is vulnerable to a sharp correction but likely that that correction will be bought creating a buy point for uptrend.
Courtesy: Karvy Commtrade Ltd.

(Source: http://www.commodityonline.com/futures-trading/technical/NMCE-Rubber-settles-higher-on-fresh-buying-21735.html)






Commodity Trading Tips for Rubber by Kedia Commodity
Posted: 07 Feb 2011 05:17 AM PST
Rubber rose due to thenews onflooding inMalaysia, anticipation and supply worries, but profit-taking capped gains. Concerns over worsening supply shortage still boost the sentiment as demand remains robust, while supply may demand further as rubber trees are entering leave-shedding season, lowering output. Natural-rubber consumption in China may rise 9 percent to 3.6 million tons this year and India's consumption may gain 5.2 percent to
991,000 tons, according to the Association of Natural Rubber Producing Countries.

Rubber yesterday traded with the positive node and settled 1.11% up at 23825. In yesterday's trading session Rubber has touched the low of 23450 after opening at 23690, and finally settled at 23825. For today's session market is looking to take support at 23558, a break below could see a test of 23292 and where as resistance is now likely to be seen at 23983, a move above could see prices testing 24142.

Trading Ideas: Rubber trading range is 23292-24142. Rubber rose due to the news on flooding in Malaysia, anticipation and supply worries. Concerns over worsening supply shortage still boost the sentiment as demand remains robust Spread between Rubber FEB & MAR contracts yesterday ended at 544.00. Spread yesterday traded in the range of 400 to 574. NMCE accredited warehouses Rubber stock rosed by 177kgs to 11523kgs.

(Source: http://www.topnews.in/commodity-trading-tips-rubber-kedia-commodity-2310561)






Natural rubber output up at 98,800 t in Jan
Posted: 07 Feb 2011 05:12 AM PST
NEW DELHI, FEB 7:

The country’s natural rubber production increased by 1.3 per cent to 98,800 tonnes in January this year from 97,500 tonnes a year ago buoyed by favourable weather.

“October-January period is considered as the peak season for rubber production in India. January production is up because of favourable weather conditions,” a Rubber Board official told PTI.

The official said that the rubber production is also likely to be better in February compared to the same month last year, but it might not match the level of the reporting month.

The board had earlier projected 893,000 tonnes of rubber production for the 2010-11 fiscal, but had to bring down the target to 851,000 tonnes as the output dipped as a result of prolonged monsoon this year.

During April-January this fiscal, natural rubber production stood at 749,950 tonnes against 729,250 tonnes in the corresponding period last year.

India had produced 831,400 tonnes natural rubber last fiscal. Consumption has also marginally gone up during January this year to 81,000 tonnes vis-a-vis 80,500 tonnes in the same month last year.

According to the Rubber Board, consumption of natural rubber, led by higher demand from automobile sector, would reach 948,000 tonnes in the current fiscal against 930,565 tonnes in 2009-10.

During April-January, India has consumed 789,230 tonnes against 775,565 tonnes in the same period last fiscal.

Natural rubber imports in January this year, however, increased to 8,643 tonnes from 7,051 tonnes in the same month last year. Exports also rose to 4,663 tonnes from 2,906 tonnes.

(Source: http://www.thehindubusinessline.com/industry-and-economy/agri-biz/article1164746.ece)






Sheela Thomas takes over as Rubber Board Chairman
Posted: 07 Feb 2011 05:10 AM PST
KOCHI (Commodity Online) : The Rubber Board is having a new Chairman in Sheela Thomas IAS who took over from V.J. Kurian on Monday.
V.J. Kurian, Chairman, Spices Board has been holding additional charge of the Rubber Board since November 2010. It was while serving as the Principal Secretary to the Chief Minister of Kerala that Sheela Thomas was appointed as Rubber Board Chairman.
A 1985 batch IAS officer, Sheela Thomas is a native of Kollakadavu near Mavelikkara and has served the Kerala Government as Director of Social Welfare, Kottayam District Collector, Managing Director of Civil Supplies Corporation, Director of Industries, Director of Census Operations, Special Secretary of Agriculture, Secretary of Transport, Secretary of NORKA and Secretary of Information and Public Relations Department.
Rubber Board is the official agency in India to take care of the cultivation and production of rubber and rubber products.

(Source: http://www.commodityonline.com/news/Sheela-Thomas-takes-over-as-Rubber-Board-Chairman-36280-3-1.html)






Tokyo futures down 2.4 pct, but supply supports
Posted: 07 Feb 2011 01:40 AM PST
BANGKOK, Feb 7 - Tokyo rubber futures dropped 2.4 percent on Monday on weaker oil prices and profit-taking as players liquidated contracts after prices failed to stay firmly above major resistance of 500 yen, but tight supply still lent support, dealers said. * The benchmark rubber contract on the Tokyo Commodity Exchange <0#JRU:> for July delivery fell 12.1 yen, or 2.4 percent, to settle at 490.8 yen per kg.

* "The market was overbought and prices have risen too high, so players sold contracts to take profits and avoid risk after prices failed to stay above the 500 yen level," one dealer said.

* Oil prices fell nearly 2 percent on Friday after an unfounded report about a possible announcement from Egypt set off speculation that President Hosni Mubarak could step down shortly, sparking profit-taking from which the market failed to recover. [O/R]

* Dealers said TOCOM rubber should rebound on Tuesday, with the 490 yen level being seen as key support level because limited supply in producing countries still provided supports.

* The benchmark Thai RSS3 was still offered at the record high of $6.10 per kg, the highest ever, although TOCOM prices fell, reflecting strong demand amid tight supply. [ID:nSGE71600W]

(Source: http://asia.news.yahoo.com/rtrs/20110207/tap-markets-asia-rubber-c3bb44c.html)






Tokyo Futures Edge Lower After Breaking Y500 Mark
Posted: 07 Feb 2011 01:38 AM PST
Tokyo rubber futures on Monday (February 7) edged off record-highs above 500 yen as profit-taking set in, but concerns about supply shortages limited losses.
The benchmark rubber contract on the Tokyo Commodity Exchange for July delivery lost 0.6 percent, or 3.2 yen, at 499.7 yen ($6.08) per kg as of 0028GMT.
It broke the psychological level of 500 yen and rose to a record 504.0 yen on Friday (February 4).
Supply in the world's top two producing countries, Thailand and Indonesia, is due to fall significantly in February and March when the two countries are in the dry season and rubber trees stop producing latex.
Oil prices fell nearly 2 percent on Friday (February 4) after an unfounded report about a possible announcement from Egypt set off speculation that President Hosni Mubarak could step down shortly, sparking profit-taking from which the market failed to recover.
The dollar held its ground against a basket of major currencies early in Asia on Monday (February 7), with markets growing wary of a reversal in a bearish trend after the greenback bounced off multi-month lows versus the euro late last week.
Indian tyre makers bought natural rubber at a record 240 rupees ($5.26) per kg on Friday (February 4) as farmers squeezed supplies seeking higher prices after a surge in the world markets, a senior official of a dealers body told Reuters.
The offer price for Thai benchmark RSS3 rubber remained at a record high on Friday (February 4).
(Reuters, February 7, 2011)






New Clones To Boost Upstream Rubber Ops in Malaysia
Posted: 07 Feb 2011 01:38 AM PST
Rubber which is a strategic commodity for Malaysia will see its upstream activities being revolutionised with the introduction of high-yielding 1Malaysia rubber clones and latex timber clones by the Malaysian Rubber Board (MRB).
According to MRB director-general Datuk Dr Salmiah Ahmad, the board was planning to set up more new MRB research stations and Malaysian rubber budwood centres (MRBC) nationwide to facilitate in the development and production of the superior clones and LTCs.
On Jan 28, MRB's first 1,180ha Rubber Research Institute Malaysia (RRIM) Similajau research station and 45ha MRBC in Bintulu, Sarawak was officially launched by Plantation Industries and Commodities Minister Tan Sri Bernard Giluk Dompok.
Salmiah told StarBiz: “Many of the new RRIM research stations and MRBCs will be located in strategic locations whereby it will be within the reach of smallholders, which are the major contributors (about 94%) to the country's total rubber production.”
It is believed that another new rubber research station and MRBC would be set up in Sarawak while three new research stations and MRBCs namely Kota Tinggi (Johor), Sg Sari (Kedah) and Bukit Kuantan (Pahang) in Peninsular Malaysia this year.
“The rationale for the research stations and MRBCs is to ensure only selected high-yielding and quality clones were distributed for the rubber planters which would guarantee and increase the yield and productivity in line with the MRB Strategy and Malaysia Rubber Industry Strategy launched in May last year,” added Salmiah.
The MRB Similajau for example would have rubber seed production area, rubber budwood nursery, polybag nursery, special management zone, commercial plantation, germplasm research facility, office and residence.
The station is aimed at providing technology transfer of new clones and agronomic practices through exhibitions, training and research and development to smallholders, private agencies and the Government.
In addition, it will provide high-quality planting materials to government and private agencies involved in the industry.
The MRBC in Similajau meanwhile would produce 3.24 million rubber budwoods per year. Its focus will be in the production of high-yielding and quality latex clones like RRIM 3001, RRIM 928, RRIM 929 and PB 350. The centre will also produce timber clones such as RRIM 2023 andRRIM 2025.
Salmiah said: “MRB's vision for the RRIM Similajau research station is to transform it into a role model for rubber plantation forest and a successful natural habitat conservatory for potential investors.
“Its existing location is also fit for an eco-tourism development given the surrounding caves, waterfall, natural lakes and conservation area under the special management zone.”
By 2020, the targetted plan was to plant some 500,000ha of rubber in Sarawak and 300,000ha in Sabah.
“The establishment of the budwood centre would be more appropriate for Sarawak and Sabah, which still have ample agriculture land compared with Peninsular Malaysia's limited land for new rubber planting.”
She said smallholders in the peninsula were widely encouraged to undertake replanting activities due to the limited landbank but those in Sarawak and Sabah should undertake new
planting via budwoods. “Sarawak and Sabah rubber planters are encouraged to undertake more planting of high-quality clones such as the 1Malaysia clones.”
In 2009, MRB introduced the 1Malaysia clone the RRIM 3001. “This clone has a potential latex production of more than 3,000kg per hectare per year and is suitable for planting on a commercial basis including for the rubber forest plantation programmes especially in Sabah and Sarawak,” Salmiah added.
(The Star, Malaysia, February 7, 2011)






Sri Lanka Tyre Maker Sales, Costs, Up
Posted: 07 Feb 2011 01:36 AM PST
Sri Lanka's Kelani Tyres, which runs a joint venture plant with India's CEAT said net profits rose 11.7 percent to 74.9 million rupees in the December 2010 quarter from a year earlier despite a steep rise in costs.
Sales volumes rose 5.2 percent to 3,753 metric tonnes in the quarter, while production rose 10.6 percent to 3,826 tonnes.
Revenues rose 37.1 percent to 1,028 million rupees and costs rose at a faster 45 percent to 796.6 million, slowing gross profit growth to a 15.0 percent rise 231.7 million rupees, according to unaudited accounts filed.
The firm reported earnings per share of 93 cents for the quarter.
For the nine months to December Kelani Tyres said sales grew 17.3 percent to 11,131 metric tonnes and production rose 13.6 percent to 10,905 tonnes.
Group profits rose 18.7 percent to 208.7 million rupees. The firm reported earnings of 2.58 rupees per share for the nine months.
(Lanka Business Online, Sri Lanka, February 7, 2011)






India's Jan Natural Rubber Production Rises 1.3 Pct
Posted: 07 Feb 2011 01:35 AM PST
India's natural rubber production rose 1.3 percent on year to 98,800 tonnes in January, a statement from the Rubber Board said on Monday (February 7).
Consumption rose to 81,000 tonnes in January from 80,500 tonnes in the year earlier period, the Board said.
(Reuters, February 7, 2011)






Rubber prices likely to climb further on supply worries
Posted: 06 Feb 2011 03:01 PM PST
Domestic production in lean phase
Bullish sentiments prevail in the natural rubber market as prices have climbed to a record high of Rs 240 per kg. Dealers say rubber was being bought by the tyre industry at Rs 240 per kg though the officially quoted price was marginally lower at Rs 239 per kg.
Prices are likely to advance further as domestic production has entered a lean phase. At the same time, global supply concerns are driving up the international prices.
International prices soar 53%
International prices have seen a 53% rise in the last three months to touch Rs 272.34 per kg as on February 5 from Rs 179.13 per kg on November 1, 2010. Concerns about a global supply squeeze were the main factors that led to the huge rise in prices.
Heavy rains and floods on account of the changing climatic conditions resulted in a cutback in production in many leading rubber-producing countries, including India. The pressure on the demand side too was high due to the growing industrial requirements from China and India.
India output appears better
Though domestic production suffered a setback initially due to the prolonged monsoons this year, forecasts show that it will be better than last year’s by nearly 20,000 tonne. Traders say supplies have improved. The difference of Rs 33 per kg between the international and the domestic prices has opened up opportunities for exporters. Exports are likely to be at the same level of last year.
Rubber Board officials said stocks are at a high level of 3 lakh tonne as of now. Though production entered a peak season in October, price rise continued unabated throughout the season.
Outlook for the coming weeks
The government has, in the meanwhile, allowed the tyre sector to import 40,000 tonne of rubber before March 31 at a concessional duty of 7.5%. As many as 31 import applications have been filed with the Director General of Foreign Trade.
The industry has approached the government to allow duty-free imports to steer clear of local high prices but the international supply squeeze is likely to pose problems for the industry. Market players are of the view that the prices are likely to breach the Rs 250 per kg range in the coming weeks if the current trends prevail.