India rubber output deficit to be 1.2 lakh tons

India rubber output deficit to be 1.2 lakh tons
WEDNESDAY, MARCH 9, 2011

KOCHI(Commodity Online) : With the Indian tyre companies seeking to augment production in the coming year and domestic rubber output slipping by 5% against the target, an expected natural rubber deficit of 1.2 lakh tons is projected by the industry players for the coming season.
Imports meanwhile would be to the tune of 1.7 lakh tons during 2011-12
To meet the demand, an additional 14,000 hectares of rubber plantation would be tapped into in 2012. But their output would reach only 14000 tons a year.
The 2010-11 domestic rubber production is pegged at 8.51 lakh tons, a Y-O-Y growth of 3%, and consumption for the same period is expected to climb 1.9% to 9.48 lakh tons.
In fact, in 2011-12 the production and consumption would widen up to 2 lakh tons, The Economic Times quoted Neeraj Kanwar, chairman, Automotive Tyre Manufacturers’ Association as saying. The association has sought duty-free imports to the same tune to meet the demand.
Rubber prices had shot up to Rs.240.50 per kg in February.



UPDATE: Asian Rubber Extends Fall; Technical, Fundamental Concerns Weigh
WEDNESDAY, MARCH 9, 2011

SINGAPORE (Dow Jones)--Asian rubber futures continued on a downward trajectory Wednesday on the back of continued bearish sentiment, poor technical signals and concerns about fundamentals.
The benchmark August rubber contract at the Tokyo Commodity Exchange settled Y4.1 lower at Y412.4 a kilogram after falling as much as 3.7% intraday--a day after it fell 8.7%.
The imminent prospect of higher trading margins may have contributed to the selloff, said a trader at major Thai exporter, who has chosen to exit the market amid the price swings. The 50%margin increase to Y143,000 is goes into effect during Wednesday's evening session.
"Tocom may test Y400/kg very soon; the technical trend is bearish," said a trader in Thailand.
The last support level was at Y450/kg, which was breached Tuesday, resulting in follow-through selling and stop orders.
"Prices may fall to Y360/kg if they fall through Y400/kg," a Tokyo-based commodities brokerage analyst said.
Tuesday's fall on the Tocom reversed a prolonged rally that saw prices hit successive record highs from December to peak at Y535.7/kg on Feb. 18. Many participants attribute the extended rally and current sharp declines to excessive speculation.
Although there is a supply deficit forecast for 2011, traders say that this isn't being felt keenly at the moment, as high rubber prices have also resulted in intensified tapping in producing countries, and as China--the biggest consumer and importer--stays away from the international market.
Some big Japanese trading firms have been actively importing natural rubber into Japan, said a trader in Hat Yai.
Japan's natural rubber imports in January rose 21% from a year earlier to 67,041 metric tons, according to data released Wednesday by the Rubber Trade Association of Japan.
A trader in Sumatra said he is still bullish on rubber prices going ahead as "supplies are really [tight] and there is demand; it's just that buyers have been on the sidelines for some time due to the high prices and volatility."
Trade participants said the correction in natural rubber prices is overdue, as rubber futures have been overbought for far too long. Sentiment turned negative over the last two weeks due to tensions in the Middle East damping risk appetite and casting doubt on economic growth in the face of high oil prices. There was also market talk that funds were liquidating their positions on the Tocom to take part in the rallying crude-oil market.
Benchmark May Shanghai rubber settled CNY690 lower at CNY36,360 a metric ton at midday.
Benchmark October Thai rubber futures hit the THB6.9/kg limit-down and was last trading at THB150.7/kg.
Benchmark April ribbed smoke sheet 3-grade on the Singapore Commodity Exchange is untraded, but April technically specific rubber-20 was down 7 U.S. cents at 446 cents/kg at 0800 GMT.



Tokyo Futures Inch Higher, Future Courses Uncertain
WEDNESDAY, MARCH 9, 2011

Tokyo rubber futures inched higher on Wednesday (Mar 9), after tumbling nearly 9 percent the previous day tracking a fall in oil prices, but traders were sceptical whether the market had hit a bottom due to bearish technicals.
FUNDAMENTALS
The benchmark rubber contract on the Tokyo Commodity Exchange for August delivery was up 2.6 yen, or 0.6 percent, at 419.1 yen as of 0058 GMT.
The key contract fell 39.7 yen to settle at 416.5 yen ($5.06) per kg on Tuesday (Mar 8), the lowest since Dec. 30. That marked the biggest daily decline since September 2009.
"The market remains uncertain, but at least huge volatility is unlikely at least for today (Mar 9) due to a steep increase in margin requirements from the evening session today (Mar 9)," said Kazuhiko Saito, chief analyst at trading house Fujitomi.
The margin requirement on trading will rise to 143,000 yen from 95,000 yen from the evening session on Wednesday (Mar 9), which is counted as Thursday's (Mar 10) regular session.
The benchmark Tokyo Commodity Exchange rubber futures contract slumped nearly 9 percent on Tuesday (Mar 8) and increasingly bearish technicals may push prices down to 400 yen ($4.86) as early as this week.
The most active contract in the Shanghai rubber futures market for May delivery rose to 36,310 yuan per tonne as of 0111 GMT on Wednesday (Mar 9), from Tuesday's (Mar 8) settlement price of 36,205 yuan.
Oil prices slipped on Tuesday (Mar 8), with Brent falling nearly 2 percent, after Kuwait's oil minister said OPEC was considering a production boost as war-torn Libya's output remained disrupted and the region's unrest fuelled concerns about more supplies being cut off.
The euro nursed heavy losses early in Asia on Wednesday (Mar 9) as worries about European sovereign debt problems tightened their grip following the recent credit rating downgrade for Greece.
(Reuters, March 9 ,2011)




Tokyo Futures Slump On Stop-Loss Selling As Oil Dips
WEDNESDAY, MARCH 9, 2011

Tokyo rubber futures tumbled 8.7 percent to the lowest in more than two months on Tuesday (Mar 8), tracking falls in oil prices, with heavy stop-loss selling adding to the pressure, dealers said. The benchmark rubber contract on the Tokyo Commodity Exchange for August delivery fell 39.7 yen to settle at 416.5 yen ($5.06) per kg, the lowest since Dec. 30. It was the biggest daily decline since September 2009.
The most active contract in the Shanghai rubber futures market for May delivery fell 2,470 yen to settle at 36,205 yuan per tonne.
U.S. crude fell below $104 a barrel after the Kuwaiti oil minister said OPEC was in talks to increase production.
Dealers said technical sentiment was poor after prices fell below psychological support at 450 yen per kg. "There was huge stop-loss selling after prices fell further below 430 yen," one dealer said.
Physical prices also dropped on Tuesday (Mar 8) as traders who had hoarded rubber, expecting to sell it when prices rose higher, started releasing some from their overflowing stocks.
TOCOM prices were expected to fall further on Wednesday (Mar 9) as players liquidated contracts to avoid risk, dealers said. However, prices were unlikely to fall below a key support level at 400 yen, they said.
(Reuters, March 8, 2011)



Tokyo rubber futures slump
WEDNESDAY, MARCH 9, 2011

Bangkok (march 09, 2011) : tokyo rubber futures tumbled 8.7 percent to the lowest in more than two months on tuesday, tracking falls in oil prices, with heavy stop-loss selling adding to the pressure, dealers said. the benchmark rubbercontract on the tokyo commodity exchange for august delivery fell 39.7 yen to settle at 416.5 yen ($5.06) per kg, the lowest since december 30. it was the biggest daily decline since september 2009.
the most active contract in the shanghai rubber futures market for may delivery fell 2,470 yen to settle at 36,205 yuan per tonne. dealers said technical sentiment was poor after prices fell below psychological support at 450 yen per kg. "there was huge stop-loss selling after prices fell further below 430 yen," one dealer said.
physical prices also dropped on tuesday as traders who had hoarded rubber, expecting to sell it when prices rose higher, started releasing some from their overflowing stocks. tocom prices were expected to fall further on wednesday as players liquidated contracts to avoid risk, dealers said. however, prices were unlikely to fall below a key support level at 400 yen, they said.