Tokyo Futures Rebound On Oil, Gold Prices

Tokyo Futures Rebound On Oil, Gold Prices
THURSDAY, APRIL 28, 2011

Key TOCOM rubber futures rebounded after three consecutive days of losses on Thursday (Apr 28) on higher gold and oil prices following signs that the U.S. may continue its easy monetary policy, but investors were cautious of active buying ahead of a long weekend.
FUNDAMENTALS
The key Tokyo Commodity Exchange rubber contract for October delivery was up 1.3 percent, or 4.9 yen, at 383.5 yen per kg as of 0020GMT.
The most active rubber contract on the Shanghai Commodity Exchange for September delivery slid 2.2 percent, or 740 yuan, to close at 32,160 yuan per tonne. Volume stood at 948,158 lots.
U.S. crude futures rose to $113.70 a barrel in early trade on Thursday (Apr 28), to their highest in 2-1/2 years as the dollar remained under pressure after a meeting of the Federal Reserve.
The dollar index fell to a fresh three-year low on Thursday (Apr 28) as Fed Chairman Ben Bernanke did nothing to change the prevailing perception that the U.S. central bank is in no hurry to raise rates.
Gold climbed to a record high of almost $1,530 an ounce on Wednesday (Apr 27) and silver jumped 6 percent.





‘Rubber to turn surplus by 2012’
THURSDAY, APRIL 28, 2011

The new chairman of Rubber Board , Sheela Thomas, has assumed charge at a time when rubber prices are at a historic high. The average domestic price of rubber stood at Rs 190.03 per kg in 2010-11 compared to Rs 114.98 per kg in the previous year. However, availability of rubber in the market has remained quite low throughout the year. Trade and industry bodies have questioned the stock estimates of the Board. Apart from this, production itself has been affected by the shortage of labour and postponement of field operations like replanting of trees. But Sheela Thomas is confident that the problems that the sector is facing can be resolved soon. In an interview to ET's S Sanandakumar , the chairman said that the stress is now on new planting and replanting during the 12th Plan period. Excerpts:
Availability of rubber is the main concern of traders and industries. Some of them have questioned the stock estimates of the Board. What are your views on this issue?
It is true that some stakeholders see availability of rubber as an area of concern. But our statistics show that enough rubber is there in the system. There are some who say that our statistical estimate is wrong. But nobody has come up with any data to prove that. If at all there is a mistake, it can only be with regard to the stock with the growers. The estimate of stocks with other sections is based on the returns they file. Because of these reasons, we have decided to have a relook at the stocks. Suggestions from the stakeholders are welcome. We will be looking at all aspects of the issue including our statistical analysis.
How are replanting and new planting operations progressing?
In the 11th Plan period, we could achieve the target with respect to new planting or new area under rubber plantations. But we could not meet the target for rubber replanting. With prices ruling high, the growers have been postponing the replanting. But in the 12th Plan period, we would give stress to both these operations. New plantations will be developed in non-traditional areas that are suited for rubber. Areas with long dry spell and severe winter are not good for rubber . Karnataka, parts of Andhra Pradesh, Orissa, Goa etc are the regions identified for expanding rubber cultivation.
There is a serious shortage of rubber tappers. How do you address this issue?
Yes, there is a shortage. But the situation is not very serious. We have been offering training to workers from other states. Moreover , tapping should be made remunerative for the workers. Other incentives like pension scheme are being considered for them. Discussions are going on, and we hope some incentives can be worked out.
How do you view the price rise of natural rubber in the international market?
The rubber price rise is on account of the shortage of rubber in the international market . The oil price rise and ecological concerns have imposed certain limits to the growth of synthetic rubber. On the other hand, a real substitute for natural rubber is yet to be developed . So, it appears that the price situation will continue for some time. A surplus situation in rubber is expected only by 2012. But if there is a major fall in prices, the domestic policy with regard to rubber can be reviewed.
(Source: http://economictimes.indiatimes.com/opinion/interviews/rubber-to-turn-surplus-by-2012/articleshow/8104676.cms)
(Reuters, April 28, 2011)





Toyo Raises Commercial Tyre Prices in US
THURSDAY, APRIL 28, 2011

A price adjustment taking effect on May 1, 2011 will see the price of all commercial vehicle tyres sold by Toyo Tire U.S.A. Corp. increase by up to 15 per cent, with in-line adjustments occurring.
The manufacturer states this rise reflects the continued escalation in raw material costs. “Due to the steep increase in the costs of raw materials affecting our industry, we must reluctantly raise prices of our product,” said John Hagan, senior director, sales, Toyo Tire U.S.A. “We appreciate the continued support and understanding of our dealers as we remain committed to providing the highest quality products.”
(Tyrepress.com, April 27, 2011)





Honda Outlook Grim, Hyundai To Gain On Japan Quake
THURSDAY, APRIL 28, 2011

Honda Motor and Hyundai Motor will paint vastly different pictures for the year ahead when they report earnings on Thursday (Apr 28) after the March 11 earthquake hammered car production in Japan and helped overseas rivals in the process.
The magnitude-9.0 earthquake and the tsunami it triggered have disrupted the supply of hundreds of components from Japan's northeast region, paralysing car production and reversing what had been shaping up to be a firm recovery from the financial crisis for Japanese automakers.
While the supply bottleneck of certain specialty parts such as microcontroller units made by Renesas Electronics Corp has also hit some automakers outside Japan, most of the pain is being inflicted on domestic brands such as Honda, where output remains at half the level planned before the quake.
Honda and Toyota Motor have forecast a return to normal production by the end of 2011, but said they do not know how quickly volumes will pick up, making it difficult to assess their earnings for the business year that started this month.
Honda may refrain from giving an annual forecast when it reports results at 3 p.m. in Tokyo (0600 GMT). Mitsubishi Motors Corp and Toyota subsidiary Daihatsu Motor gave no guidance on Wednesday (Apr 27).
A survey of 15 analysts forecast Honda's operating profit to sink 37 percent to 394 billion yen ($4.83 billion) in the business year to March 31, 2012, from an estimated 627 billion yen in 2010/11.
For the January-March fourth quarter, operating profit is forecast to rise 7.3 percent to 103.1 billion yen, according to consensus estimates gathered by Thomson Reuters I/B/E/S after the quake.
The slump in auto production accounted for about half the record 15.3 percent fall in Japanese factory output in March, the government said on Thursday (Apr 28).
The earthquake has not only splintered the industry's complex supply chain, but has forced a delay in vehicle launches.
Honda had been scheduled to begin selling a new hybrid station wagon based on the popular Fit subcompact in Japan a week after the quake, while Toyota has also postponed the launch of wagon and minivan versions of the Prius.
But an even bigger worry is what the shortage of Japanese cars and the long wait for consumers would do to their market share in key regions such as the United States and China as some car buyers opt to shop at competing brands, one analyst said.
"Frankly, right now there's no way to know how this will play out in the medium to longer term," said Takaki Nakanishi, an auto analyst at Merrill Lynch Japan Securities.
"While supply is tight through the summer, some sales will shift to other brands such as Hyundai. We'll only start to get a sense of whether this trend is temporary or not towards the end of the year."
FULL SPEED AHEAD FOR HYUNDAI
That is just what analysts are expecting as they project further market share gains for Hyundai and the top South Korean automaker's affiliate, Kia Motors.
The pair, which together rank fifth in the world in car sales, are expected to post double-digit growth in net profits for their January-to-March first quarter, driven by a global market recovery and strong demand for new models.
Hyundai is expected to post first-quarter net income of 1.36 trillion won ($1.3 billion), up 20 percent from a year ago, while Kia's net profit is seen surging 70 percent to a record 676.41 billion won.
The momentum is set to pick up in April-June as they enjoy higher pricing, partly helped by the output cuts in Japan. Hyundai and Kia have been virtually unaffected by the disaster because they use few Japanese components.
"Before the earthquake, concerns lingered about price competition, but we can pretty much rule that out now," said Yoon Pil-joong, an analyst at Samsung Securities.
Hyundai will report first-quarter earnings at 2 p.m. in Seoul (0500 GMT) on Thursday (Apr 28) and Kia announces on Friday (Apr 29).
Hyundai and Kia are targeting combined sales of 6.33 million vehicles this year, which could be on par with Toyota's sales, which analysts forecast at 6.3 million to 7 million.
As of Thursday (Apr 28) morning, Honda's shares were down 7.1 percent from pre-quake levels, compared with a 7.7 percent fall in Tokyo's transport sector subindex. Hyundai's shares have surged 29 percent in the same period, hitting record highs this month.
"Japanese car makers have failed to provide a clear picture of how they are going to get back on their feet," said Park Sang-won, an analyst at Eugene Investment & Securities in Seoul.
"They may lose their leadership in the global auto market to Korean car makers for the longer term."
(Reuters, April 28, 2011)





Tokyo Futures Up On Firm Oil, Capped By Yen, Auto Concerns
WEDNESDAY, APRIL 27, 2011

Key Tokyo rubber futures rose on Wednesday (Apr 27) as oil prices firmed, but the rise was capped by a stronger yen and concerns over weak demand from Japan's auto industry which has been hit by supply chain disruptions after last month's earthquake.
FUNDAMENTALS
The benchmark TOCOM rubber futures for October delivery, rose 5.3 yen or 1.4 percent to 395.2 yen per kg as of 0011 GMT.
On Tuesday, the contract fell nearly 3 percent to as low as 384.3 yen, hurt by concerns about weak demand from the Japanese auto industry and sluggish Shanghai rubber futures.
The most active rubber contract on the Shanghai Commodity Exchange for September delivery fell 370 yuan ($56.680) per tonne to close at 32,900 yuan per tonne on Tuesday (Apr 26). Volume stood at 630,100 lots.
Oil was steady on Wednesday after Brent crude edged up in volatile trading and U.S. crude ended little changed the day before as investors eyed a U.S. Federal Reserve two-day policy meeting for any signal of a change in monetary policy.
The euro scaled fresh 16-month peaks against a broadly weaker greenback early in Asia on Wednesday, while the Swiss franc hit a record high as markets held bearish bets on the U.S. currency ahead of the outcome of the Federal Reserve meeting. The dollar slid to three-week lows around 81.29 yen.
(Reuters, April 27, 2011)