Natural Rubber prices touch Rs 243/kg, highest for 2011

Natural Rubber prices touch Rs 243/kg, highest for 2011
TUESDAY, APRIL 5, 2011

New Delhi, Apr 5 (PTI) Natural rubber prices today rose by Rs 3 to Rs 243 per kg in the domestic spot markets, the highest for the current year, largely on back of increased demand amid low supply in the market.
Natural rubber prices were ruling at Rs 240 per kg yesterday in the domestic physical markets, Rubber Board data showed.
"Natural rubber prices have increased today as the farmers are not bringing the produce in the market that led to increased demand amidst low supply," Cochin Rubber Merchants Association Advisor N Radhakrishnan told PTI.
Some produce came into the market in the late afternoon which has softened the prices a bit, he added.
"Tapping has again started in most of the plantations and hence we can expect the prices to come down in the next ten days," he pointed out.
Today''s rubber prices of rubber is the highest for the current year. It had touched Rs 240.50 per kg on February 18.




Tokyo rubber futures hit one-month high
WEDNESDAY, APRIL 6, 2011

Tokyo (april 06, 2011) : tokyo rubber futures rose to a one-month high on tuesday, as sentiment improved on rising oil prices and concerns over supply. the key tokyo commodity exchange rubber contract for september delivery settled up 14 yen or 3.2 percent at 458.1 yen per kg. it rose as high as 466.8 yen or 5.1 percent to its highest since march 7. dealers said there was heavy speculative buying on a bullish technical outlook after the price broke above resistance at 450 yen.
the shanghai rubber market is closed for a holiday on monday and tuesday. the most active shanghai rubber contract for september delivery fell 260 yuan to finish at 34,635 yuan ($5,288) per tonne on friday.



Spot rubber rules steady
WEDNESDAY, APRIL 6, 2011

KOTTAYAM, APRIL 5:
Spot rubber finished almost steady on Tuesday. The market opened better and improved further on early trades but lost ground following declines on domestic futures.
But a partial recovery on the National Multi Commodity Exchange during closing hours did not make any impact in the market.
According to observers, there was no selling pressure from dealers and the prices remained under pressure on buyer resistance. The trend was mixed and volume low.
Sheet rubber finished unchanged at Rs 241 a kg after hitting an intraday high of Rs 244 a kg in the morning session. The grade improved to Rs 243 (240) a kg both at Kottayam and Kochi, as reported by the Rubber Board.
The April series weakened to Rs 242.04 (245.55), May to Rs 248.98 (252.59), June to Rs 252.75 (257.39) and July to Rs 253.35 (258.81) a kg for RSS 4 on the NMCE.
RSS 3 (spot) closed at Rs 266.13 (258.08) a kg at Bangkok. The April futures for the grade increased to ¥482.7 (Rs 254.30) from ¥460 a kg during the day session but then remained inactive in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 241 (241); RSS-5: 236 (236); ungraded: 231 (232); ISNR 20: 235 (235) and latex 60 per cent: 140 (140)




Ministry to appoint agents to reduce rubber price manipulation
WEDNESDAY, APRIL 6, 2011


SERIAN: Ministry of Plantation Industries and Commodities is planning to appoint agents to buy rubber products directly from the rubber tappers in an effort to reduce price manipulation by middlemen, revealed its minister Tan Sri Bernard Dompok.
He added that even though there was lesser incidence of manipulation by the middlemen in Sarawak, the ministry would go ahead with its plan.
“What we can do is to appoint agents like what Malaysian Palm Oil Board (MPOB) is doing. By doing this we will reduce the incidence of (price) manipulation by middlemen especially in the rural areas,” Dompok told the media after officiating at the Malaysian Rubber Board Clone Expansion Project at Kampung Lebor, near here yesterday.
He was responding to a call by local smallholders who have complained that the price of the commodity has fluctuated due to control by the middlemen.
On a related matter, Dompok said he would be bidding for a fund to plant some 25,000 hectares of rubber in Sarawak in the next five years.
“I am confident the government will provide the fund because rubber is now one of the 12 areas of the National Key Economic Areas (NKEA). The government wants to add it together with palm oil,” said Dompok.
If successful, each participants will be allocated RM13,000 per hectare of rubber which will be planted throughout the state.
Currently there are some 158,491 hectares of rubber planted in Sarawak which are mostly owned by the smallholders.
“Our target is to identify other areas which are suitable for the crop,” he added.
Dompok revealed that under the Ninth Malaysia Plan, the federal government had allocated some RM8.394 million for 1,450 hectares of rubber in 36 locations in Sarawak.
He said the scheme has already benefited 1,550 smallholders.
“There is definitely bright future for the local rubber industry,” stressed Dompok.
Meanwhile, Malaysia Rubber Board (MRB) secretary-general Datuk Dr Salmiah Ahmad revealed that some 250,000 smallholders have benefited from the scheme provided by MRB.
“Our research and development has enabled us to produce higher yield rubber trees which increased productivity of our smallholders,” she added..




India rubber growers to get subsidy through NEFT
WEDNESDAY, APRIL 6, 2011


KOCHI (Commodity Online): India Rubber Board has decided to introduce the system of paying subsidy to growers through bank accounts through National Electronic Fund Transfer (NEFT).
In this new system of payment, the beneficiaries should give details of their bank account number and IFSC code in the application for rubber planting subsidy, according to a press release.
At present payment of subsidy to the beneficiaries are made by the regional offices by cheques sent by post which sometimes result in loss in transit, return due to incorrect address etc.
The growers who are already receiving subsidy may intimate their bank account details, as and when demanded from the regional offices concerned. The field level officers will ensure the correctness of the bank accounts either by getting a certificate from the manager of the bank or by getting a cancelled bank cheque from the beneficiary containing account number and IFSC code.





Rubber cultivation in South America booms as prices soar
WEDNESDAY, APRIL 6, 2011


Rising auto sales in emerging nations have led to higher demand for tires, fueling a rapid increase in rubber tree planting in Colombia.
Reporting from Puerto Lopez, Colombia—
As Walter Lopez carefully stripped a diagonal ribbon of bark from a rubber tree in easternColombia, white latex began dripping down the cut and into a miniature pail nailed to the trunk.
"Being outdoors, you learn how to respect the trees," said Lopez, a longtime rubber tapper at the Mavalle plantation on the Llanos jungle flatlands, 150 miles east of the capital, Bogota. "This is a great way of life."
Until recently, few shared it in Colombia, where pests and poor soil were thought to make rubber plantations unfeasible. Southeast Asia is the source of 94% of the world's rubber supply. The success of the 1,200-acre Mavalle operation was considered an anomaly. Colombia accounted for only a tiny fraction of the 11 million tons of rubber harvested worldwide last year.
But the doubling of rubber prices since 2007 to about $2.25 per pound, along with advances in soil management, are once again spurring interest in the cultivation of rubber in South America. Giant agribusinesses as well as small entrepreneurs are planting thousands of acres in this sparsely populated region, hoping to cash in.
In Colombia, rubber tree planting has increased tenfold over the last decade to 25,000 acres, a figure that could triple again by 2016. Last year's harvest of 3,200 tons of rubber is projected to reach 35,000 tons by 2020.
Driving rubber prices higher are brisk car sales in China, India and other emerging nations. That has created a corresponding demand for tires, which soak up 70% of the world's natural rubber production, said Raul Nizo, the business manager for Mavalle, which is owned by Colombian billionaire Luis Carlos Sarmiento.
China is the world's largest car market, with 13.8 million vehicles sold last year — a 33% increase from2009. Although growth is expected to slow from that torrid pace, the market continues to expand. SAIC Motor Corp, China's biggest automaker, expects its 2011 vehicle sales to rise 12% to about 4 million units.
Advances in agriculture are aiding Latin American rubber farmers as well.
Henry Ford's fabled Fordlandia rubber plantation in Brazil was devastated in the 1930s by a fungus known as South American leaf blight, or Microcyclus ulei. Today the region's rubber growers are avoiding that scourge by planting trees in areas with just the right mix of humidity, temperature and rainfall conditions, said Anibal Tapiero, a plant pathologist with Corpoica, Colombia's government-sponsored agricultural research agency in Villavicencio.
Another farming innovation — adding lime to once useless, highly acidic grassland to make it fertile — is driving production of other crops as well. Millions of dollars are being invested into Llanos soy, rice, corn and sugar farms.
Ecopetrol, the state-controlled oil company, is betting on this area's future as a farm center. Its Bioenergy biofuels unit is planning to start construction soon on Colombia's largest ethanol plant. The $139-million facility will be fed with sugar cane from a newly planted 40,000-acre plantation.
"Since 2007, high-powered investors have been attracted to the plains for the low cost, government credit and improving infrastructure," Tapiero said.
Still, he said, there is plenty of risk. Newly planted rubber trees take seven years to become productive, so investors must be patient. The region also is vulnerable to drought, and the soil degrades easily.
But perhaps the biggest challenge in this lightly populated area is a labor shortage. Mavalle's Nizo said oil firms in the region pay five times the wages that farm workers earn. To recruit, he markets benefits such as free childcare and education and the chance to obtain small loans to start side businesses. Nizo said the other selling points are the tappers' tranquil way of life and a stable work environment.
Cauchopar, a company starting a 1,600-acre rubber plantation in San Teodoro in Vichada state 160 miles east of here, is so concerned about securing enough reliable help that it's offering ownership to prospective rubber tappers.
Workers will have the option of buying 25-acre plots of rubber trees after seven years of production, or 14 years after the trees have been planted.
"With all the development of the Llanos, we are creating a time bomb, which is the very high demand for workers. But no one is thinking about how to supply it," said Cauchoparexecutive Rodrigo Echeverri. "Offering workers the option to buy is the only way to guarantee a source of labor."
Lopez, the Mavalle tapper, said he has heard about the high wages being offered by oil companies but that for now the 43-year-old is staying put. Six of his family members also work here.
"I'm doing something good for the environment. I can't imagine any other job."





Tokyo Futures Rise On Weaker Yen But Caution May Cap
WEDNESDAY, APRIL 6, 2011

Key Tokyo rubber futures rose on Wednesday (Apr 6) on a weaker yen and a rise in oil and other commodities the day before, but the market may be capped as investors grow cautious about the recent rapid pace of price increases.
FUNDAMENTALS
The key Tokyo Commodity Exchange rubber contract for September delivery was up 3.5 yen or 0.8 percent at 461.6 yen per kg as of 0026 GMT.
The contract rose as high as 464.9 yen earlier, just below Tuesday's (Apr 5) high of 466.8 yen, its highest since March 7.
The Shanghai rubber market will reopen after a two-day holiday earlier this week. The most active Shanghai rubber contract for September delivery fell 260 yuan to finish at 34,635 yuan ($5,288) per tonne on Friday (Apr 8).
U.S. crude futures eased on Wednesday after falling in choppy trade the day before ahead of weekly inventory reports, hemmed in by the prospect that the reports would show crude stocks rose again last week. Brent crude jumped to a 2-1/2 year peak above $122 a barrel on Tuesday (Apr 5).
The yen extended its decline early Asian trade on Wednesday (Apr 6), hitting fresh 11-month lows against the euro and the Australian dollar and looking to deepen its losses as technical support levels threaten to give way.
(Reuters, April 6, 2011)





New duty structure to ease Indian tyre makers’ margin
TUESDAY, APRIL 5, 2011

NEW DELHI (Commodity Online) : With the change in duty-structure, India’s domestic tyre manufacturers will find it less draining on their resources when it comes to importing natural rubber.
The duty has been fixed at Rs 20 a kg or 20 %, whichever is lower.
For imports up to 40,000 tons, the government had lowered duty on natural rubber in December to 7.5% which was effective until March 31, The Economic Times said.
Currently, the rubber prices are at Rs.233 a kg. Earlier duty impositions slashed margins by Rs.47 a kilogram.
Estimates suggest that rubber imports for 2011 are likely to be around the 2009-10 level of 1.7 lakh ton even as deficits pegged at 90,000 tons, against 99,165 tons in 2009-10.
India is the fourth biggest rubber producer in the world.




Tyre makers' profitability may skid in 12-15 months: ICRA
TUESDAY, APRIL 5, 2011


MUMBAI: Despite a robust demand for tyres in the domestic market, the profitability of manufacturers will be affected in the next 12-15 months due to supply gap for rubber, rating agency ICRA said.
Rising raw material costs as well as increased debt and higher interest and depreciation charges are likely to keep industry profitability under pressure over the medium term in spite of a strong growth potential, ICRA said in a statement.
The domestic industry faces the threat of increasing penetration of Chinese tyres into the Indian truck and bus (T&B) radial segment, at least partly contributed by domestic capacity constraints, the rating agency said.
The industry is currently at a structural inflexion point in the T&B segment, with the Indian market converging towards the global trends of radials in the commercial vehicle segment, it said.
It said sensing immense potential in the industry, particularly for radials, many industry majors have announced large capital expenditure plans for the next two years.
"While demand is expected to be robust going forward, cost pressures, particularly from natural rubber, remains a challenge. Ability to successfully pass on the input cost to the end customer increases, which will be critical for the industry," ICRA Senior VP & Head Corporate Ratings Subrata Ray said in the statement.
With no significant supply additions for rubber expected over the next 12-15 months, rubber prices are likely to remain high over the next four-six quarters, it said.