Rubber prices to see technical correction

Rubber prices to see technical correction
SATURDAY, MARCH 5, 2011
Malaysian rubber prices are expected to ease on technical correction next week, dealers said.
A dealer said although the market may trade lower, it was still healthy.
"Although the current rubber production is tight, traders will adopt a wait-and-see attitude in anticipation of a fall," he said.
He said the Tokyo rubber futures, which were expected to rebound after prices finished above the key psychological level of 470 yen per kg due to seasonal tight supply in major producing countries, was expected to provide the support.
On a weekly basis, the Malaysian Rubber Board's official physical seller price for tyre-grade SMR 20 fell 102 sen to 1,632 sen per kg from 1,734 sen per kg previously.
Latex in bulk rose 12.5 sen to 1092 sen per kg from 1,079.5 sen per kg last Friday.
The unofficial seller closing price for tyre-grade SMR 20 declined 99.5 sen to 1,628 sen per kg from 1,727.5 sen per kg last week, while latex in bulk increased 5.5 sen to 1,091.5 sen per kg from 1,086 sen per kg previously. – Bernama




Covering buys cushion weak trend in spot rubber
SATURDAY, MARCH 5, 2011
KOTTAYAM, MARCH 4:
Spot rubber showed a mixed mood on Friday. The market appeared to be moving under the shadow of a weak trend on the National Multi Commodity Exchange but it managed to hold on in most active counters amidst dull volumes. The sentiments were also affected by the declines in international indices but the absence of quantity sellers and weekend covering purchases extended moderate support though the gains were partial and limited. Latex continued its downward journey on extremely low demand.
Sheet rubber improved to Rs 230 (229.50) a kg according to traders. The grade finished unchanged at Rs 230 a kg, as quoted by the Rubber Board.
FUTURES SLIP
The March series slipped to Rs 228.95 (229.58), April to Rs 238.17 (238.46), May to Rs 242.35 (243.32), June to Rs 245.29 (245.54) and July to Rs 243.76 (244.24) a kg for RSS 4 on the NMCE.
RSS 3 (spot) declined to Rs 270.10 (274.34) a kg at Bangkok. The March futures for the grade weakened to ¥501.5 (Rs 273.48) from ¥510.4 a kg during the day session but then remained inactive in the night session on the Tokyo Commodity Exchange (TOCOM).
Spot rates were (Rs/kg): RSS-4: 230 (229.50); RSS-5: 228 (228); ungraded: 225 (225); ISNR 20: 229 (227) and latex 60 per cent: 137 (138).




Rubber sapling prices too high, ministry told
SATURDAY, MARCH 5, 2011
The Agriculture Ministry has been asked to cut its proposed prices for rubber saplings as part of a programme to expand rubber plantations in the country.
The Natural Rubber Committee, chaired by Deputy Prime Minister Suthep Thaugsuban, last month approved an increase in sapling prices to 25 baht each from 18 baht.
The government plans to supply saplings free of charge to farmers in order to expand rubber plantation areas by 800,000 rai over the next three years. The scheme would cost 3.9 billion baht.
The ministry has since asked the committee to approve a price of 30 baht per sapling.
"The proposed rubber sapling price is quite high," said Mr Suthep, who has asked the ministry to propose a new price late this month.
Rubber is trading at record highs amid strong global demand led by China's booming automobile and tyre industries. More farmers are interested in switching to the crop in the expectation that high prices will continue. A rubber tree takes seven years to mature.
Deputy Agriculture Minister Supachai Phosu said the market price of rubber saplings was currently 35-40 baht apiece.
"We fear that there will be no bidders as the reference price is lower than the market price. Moreover, the ministry plans to decrease sapling supplies to farmers to only 80 units per rai from 90 previously," he added.
Based on 80 saplings per rai, a ministry projection showed that 76 would be planted with four kept in reserve in case of any damage. Based on 76 saplings per rai, the total supply would be 64 million with a budget of 1.6 billion baht.