China Natural Rubber Imports Down 14.4%

China Natural Rubber Imports Down 14.4%
WEDNESDAY, MARCH 23, 2011

March 22 -- China posted a 14.41 percent year-on-year fall in the imports of natural rubber to 107,200 tons in February, reports yicai.com, citing the General Administration of Customs.
For the first two months, China imported 254,600 tons of natural rubber, a decline of 14.2 percent year-on-year. The average import price was $4,708.02 per ton.
The top exporters of natural rubber to China in February were Thailand, Indonesia, Malaysia, and Vietnam.
For the two months, China imported a total of 230,900 tons of synthetic rubber, down 6.42 percent year-on-year. The average import price was $3,245.5 per ton.
The top exporters of synthetic rubber to China in February were Korea, Japan, the U.S. and Russia.
Shares of Wuxi Boton Belt (300031) rose 0.42 percent to close at 19.12 yuan per share.





Bears back in the horizon to haunt Rubber
WEDNESDAY, MARCH 23, 2011

AHMEDABAD (Commodity Online): NMCE Rubber prices are rising from last week. Technically rubber is in uptrend but prices are expected to correct for time being on the back of profit booking by traders.
Today Rubber opened at 23110 and from there it rose and made high of 23875 touching its resistance and then again it came back down and is trading near 23200. Rubber made shooting star on daily chart and tomorrow trade below today’s low will give confirmation of short term bearish trend for the price targets of 22000 and 21450.
“Technically, Short term traders can sell rubber near 23250 for the price targets of 22000.” said Bharti Navlani, technical analyst with Commodity Online.
(Source: http://www.commodityonline.com/marketmovers/Bears-back-in-the-horizon-to-haunt-Rubber-2011-03-22-3273-3-1.html)




Thailand to set benchmark price for rubber
WEDNESDAY, MARCH 23, 2011

Thailand, the world's largest producer of rubber, will establish an internal reference price of raw materials to minimize the effects of volatility in international futures market.
The committee created by the government will work on a methodology for setting prices, to be used as a reference point in the nation, said Apichart Jongskul, head of the Office of Agricultural Economics. Apichart is also secretary of the committee.
Thailand, Malaysia and Indonesia, the three major producers, last week a tentative agreement on $ 4 per kg at a minimum price after rubber futures fell to 37% from a record 535.7 yen on February 18. Worsening unrest in West Asia and the slowdown in the growth of car sales in China, the biggest buyer, raised concerns demand may decrease. The worst-ever earthquake in Japan also intensified the losses. "Additional studies will determine the price reflecting the demand and supply, and be less influenced by movement in the futures market," said Apichart.
The level of $ 4 is the minimum to which farmers can make a profit if production costs and inflation are included, Yium Tavarolit, the quality of executive director of the International Rubber Consortium, said by telephone Tuesday. Rubber futures in Tokyo rose by 26% after touching a four-month low of 335 yen per kg on March 15 after Thailand, Indonesia and Malaysia agreed in principle to delay exports if the price fell. The contract for August delivery rose to 5.1% at 429.6 yen per kg.
(Source: http://www.financialexpress.com/news/thailand-to-set-benchmark-price-for-rubber/765965/0)




Spot rubber rules firm
WEDNESDAY, MARCH 23, 2011

Physical rubber prices ruled firm despite a weak closing in domestic futures on Tuesday. The market surged ahead following the sharp gains in international markets. According to sources, buyers were on the toes to cover their positions expecting the bullish trend to continue in the days ahead.
Meanwhile, the key Tokyo rubber futures bounced back once again led by rising physical rubber prices in major producing countries and firm oil prices.
Sheet rubber closed firm at Rs 229 (224) a kg as quoted by the traders. The grade increased to Rs 228 (223) a kg both at Kottayam and Kochi according to Rubber Board.
The April series weakened to Rs 231.34 (236.85), May to Rs 237 (242.89), June to Rs 241.60 (248.11) and July to Rs 242 (249.86) a kg for RSS 4 on the National Multi Commodity Exchange (NMCE).
The volumes totalled 20714 lots and open interest 7980 lots. The turnover was Rs 490.66 crores.
RSS 3 (spot) increased sharply to Rs 251.76 (241.34) a kg at Bangkok. The March futures flared up to ¥440 (Rs 243.87) from ¥411 a kg during the day session and then to ¥449 (Rs 248.88) in the night session on the Tokyo Commodity Exchange (TOCOM).
Spot rates were (Rs/kg): RSS-4: 229 (224); RSS-5: 225 (220); ungraded: 222 (217); ISNR 20: 221 (219) and latex 60 per cent: 130 (120).



Thailand To Implement Rubber Price Guarantees
WEDNESDAY, MARCH 23, 2011

Thailand‟s Natural Rubber Policy Committee has agreed to set minimum and
maximum prices for natural rubber as part of a range of measures intended to
stabilise the industry and prevent major fluctuations in price. The Bangkok Post
reported on July 22 that a task force chaired by the country‟s Agriculture and
Cooperative Ministry has been appointed to lay out these price guidelines within one
month.
According to the paper, deputy agriculture minister Supachai Phosu has described
the Thai government‟s short-term solution to recent fluctuations; the government is
said to have asked for cooperation from the Bank of Thailand to “support commercial
banks in lending to entrepreneurs who buy rubber and keep their stocks when the
rubber price is below 120 baht a kilogramme.” Rubber prices increased to 150 baht a
kilogramme last week from 80 baht and the trend will most likely continue due to the
dry season.
Supachai also said Thailand wishes to cooperate with Indonesia and Malaysia in
establishing a minimum price of 120 baht a kilogramme, while the maximum price
should not be, reports the Bangkok Post, so high that it drives users to synthetic
rubber. Apichart Jongsakul, director of the Office of Agricultural Economics, said the
production cost of rubber was about 40 baht a kilogramme, and therefore 120 baht
was the „appropriate‟ price. He added that the price drop late last week was caused
by unrest in Libya and the Middle East, the Japanese earthquake and tsunami, along
with recent high prices deterring purchases from entrepreneurs in China.
On March 16, Suthep Thaugsuban, Thailand‟s deputy prime minister and chairman
of the National Rubber Policy Committee, reported implementing a temporary stop
on rubber exports in response to declining prices; at the time he said the current
decline was not „in line‟ with the commodity‟s trading nature. “Rubber is one of the
country‟s major sources of foreign exchange and therefore the government must
give it special attention,” he said.
(Tyrepress.com, March 22, 2011)




Indonesia Rubber Output Seen Up Over 20pct at 3.6 Mil Tons
WEDNESDAY, MARCH 23, 2011

Indonesia, the world's second-largest rubber producer, will boost its output by more than 20 percent to 3.6 million tonnes by 2015, the Indonesian Rubber Association (Gapkindo) said on Tuesday (Mar 22).
Within five years, domestic consumption of rubber in Southeast Asia's largest economy should jump to 20 percent of total production, Suharto Honggokusumo, executive director of Gapkindo told Reuters.
Indonesia produced 2.8 million tonnes of rubber in 2010, and Honggokusumo sees this rising between 6 and 8 percent this year.
The La Nina weather anomaly caused unusually heavy rains this year in Indonesia, including during the usual dry season, hitting output of many commodities.
"Before 2007, the (annual percentage) increases were around 10 percent," he said. "This is our ability. The economic situation is getting better in 2010.
"We need to improve the quality and increase the production in 2011," he added.
Indonesia's domestic rubber consumption was 422,000 tonnes in 2010, and Honggokusumo sees a 10 percent increase this year.
"This is normal, like in China, the economic growth is very fast," he said. "Everybody wants to have a better life -- from bicycles to motorbikes, then to cars."
"We need to increase the local consumption," he added. "In 2015 we would like to have 20 percent of production consumed locally."
Global demand for rubber, both natural and synthetic, is forecast to rise to 26.1 million tonnes in 2011 from 24.4 million tonnes in 2010, the International Rubber Study Group said earlier this month.
Dealers say this is in part due to a recovery in the automotive sector. The U.S. auto industry snapped a four-year sales decline in 2010, including three consecutive months of sales above the 12 million-unit annual rate.
Tokyo rubber futures, which set global trend, jumped to a two-week high on Tuesday (Mar 22) to finish at 433.9 yen ($5.35) per kg on supply concerns.
"The trend of the rubber price is high," he added.
Rubber prices hit record highs in mid-February but have plunged this month as doubts grew over demand and the global economy, in reaction first to unrest in the Middle East and then to last week's devastating earthquake in Japan.
"It is not good for both buyers and producers," said Honggokusumo, who was unable to give an average price forecast for 2011. He added that almost 86 percent of Indonesian rubber plantations belong to small-holder farmers.
The Thai government said on Monday (Mar 21) however, that it would not intervene in the domestic rubber market at this point as prices had rebounded to a level farmers were satisfied with.
Traders had said the government could intervene directly in the market and buy rubber that it would stockpile. Top exporter Thailand produces about a third of the world's natural rubber.
Honggokusumo said the Indonesian government was unlikely to intervene to support rubber prices.
On the Japanese earthquake and tsunami, which spurred a nuclear crisis, Honggokusumo said he had not heard of any cancellations or postponements of deliveries to Japan.
Japan accounts for 7 percent of global demand for natural rubber.
"It is business as usual," he added. "I don't think there is a major impact for us."
Having just returned from a rubber industry event in China, Honggokusumo sees the world's second-largest economy leading demand for years to come.
"They need more rubber," he said.
(Forexyard, March 22, 2011)




Tokyo Futures Hit Two-Week High On Supply Concerns
WEDNESDAY, MARCH 23, 2011

Tokyo rubber futures jumped to a two-week high on Tuesday (Mar 22) after a recovery in physical prices due largely to tight supply in producing countries spurred speculative buying in futures, dealers said.
The benchmark rubber contract on the Tokyo Commodity Exchange for August delivery rose 25.3 yen, or 6.1 percent, from Friday's close, to settle at 433.9 yen ($5.38) per kg. It touched 434.5 yen, the highest since March 8.
The Tokyo rubber futures market was closed on Monday (Mar 21) for a public holiday.
The most active Shanghai rubber futures for May delivery rose 280 yuan to settle at 35,900 yuan ($5,466) per tonne.
Brent crude futures were steady near $115 on Tuesday (Mar 22), supported by spreading unrest in the Middle East; uncertainty about demand from Japan, the world's number three consumer, capped gains.
The price of benchmark smoked rubber sheet (RSS3) jumped to $5.60 per kg on Tuesday (Mar 22), up from last week's $5.00, even though the Thai government said it saw no need to intervene in the market right now as prices were supported by seasonal tight supply, traders said.
TOCOM prices were expected to rise further after the benchmark finished above key resistance at 430 yen per kg; the next technical level is 450 yen,
(Reuters, March 22, 2011)




NMCE Rubber slumps on profit selling
WEDNESDAY, MARCH 23, 2011

NMCE rubber futures traded down on active selling interest on previous gains on Tuesday. Futures started the day on positive note on extended buying. However, profit selling on huge gains pressurized the prices.
However, positive trend in domestic spot and International market also supported the prices to recover. Rubber futures at TOCOM were ended on positive note at ¥446.00 per Kg. Thus, on overall positive cues futures at NMCE recovered but recovery was not enough to and prices ended the day in red.
The rubbers futures are projected to continue the losses on active profit selling initially on Wednesday. However, TOCOM August futures are trading positive at ¥436.00 per Kg. on active buying interest.
Reports of decline in shipment from Thailand as Japanese auto manufacturing companies have resumed their activity are likely to support the prices. Overall market trend is looking positive on supply concern which might support the prices to bounce back later in the day.
Factors to Watch For
As per deputy head of the China Rubber Industry Association, Natural-rubber demand in China, the biggest consumer, will rise 8% this year. Consumption will be 3.24 million metric tons, while tire output will climb 7.9 percent to an all-time high of 453 million units
As per the Committee on rubber policy of Thailand Government, Thai government will negotiate with commercial banks to extend loans to exporters to buy rubber from farmers at a minimum price of 120 baht per Kg
According to rubber board of India, Indian February Natural Rubber Output is 54,500 Tons Vs 51,500 Tons, consumption is 79,000 Tons Vs 76,350 Tons and imports are 6,831 Tons Vs 12,278 Tons
As per data released by rubber board, the year end deficit in natural rubber in India is estimated around 1.2 lakh tons and it is expected to be increase to 2 lakh tons during 2011-12
According to Rubber Research Institute of Thailand, ribbed smoked sheet prices gained for a fourth day, up by 6.4 percent to 162 baht a kilogram on Monday
According to the Association of Natural Rubber Producing Countries, Consumption in China, India and Malaysia, representing 48% of global usage, will increase this year
DERIVATIVE ANALYSIS
Indian Futures (NMCE)
The NMCE March contract, prices are falling while volumes and open interest are rising. If prices are in a downtrend and open interest is on the rise, chartists know that new money is coming into the market, showing aggressive new short selling. This scenario will prove out a continuation of a downtrend and bearish conditions.
Japan Futures (TOCOM)
The TOCOM active August contract, prices are rising while volumes and open interest are falling. Market is running out of traders willing to open or hold an open long/buy. Traders are liquidating both loosing short positions & closing winning long positions. A higher probability the market is set to retrace in price lower at some point.
Shanghai Futures (SHFE)
The SHFE active July contract, prices and open interest are rising while volumes are falling. 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.
(Source: http://www.commodityonline.com/futures-trading/technical/NMCE-Rubber-slumps-on-profit-selling-22736.html)




NR Producers Put Support Measures on Hold as Prices Rise
WEDNESDAY, MARCH 23, 2011

Natural Rubber producing countries have put on hold plans to support prices. Falling prices had prompted Thailand Indonesia and other countries to announce price support plans scheduled to take effect if prices fell to around $4/kg, but these have been put on hold, as prices have continues to rise in recent days. Today (Mar 22) prices reached around $5.50/kg in Tokyo
Specifically, a meeting by the International Rubber Consortium to discuss measures supporting natural rubber prices is now on hold as prices have rebounded strongly in the last few days, IRCo acting chief executive Yium Tavarolit said Monday (Mar 21). "Because natural rubber prices have breached the floor rate of THB120/kg (stipulated by the Thai government), that meeting is now not needed for the time being," said the Bangkok-based Yium after the Thai national rubber committee meeting held Monday (Mar 21) afternoon.
If prices fall below the floor rate, measures that have been mentioned last week, such as an export suspension, would be again considered.
Yium also said IRCo and the International Tripartite Rubber Council would be writing to the Tocom and the Shanghai Futures Exchange to ascertain the causes of price swings in the last few weeks, and to ask the exchanges to cooperate in reducing price volatility.
(European Rubber Journal, March 22, 2011)