NR prices recover in Tokyo (June 29)
June 29, 2011
On Tokyo’s Tocom Exchange, prices for the six-month contract recovered by yen 7 overnight, closing at yen 358 ($4.41) per kg on Wednesday 29 June. Shorter-dated prices moved up, closing at around yen 364.
In Singapore, SGX said September RSS3 was up around $0.04 on Tuesday’s prices at around $4.45. Contracts for December 2011 were trading at around $4.44.5. Short-dated TSR 20 was also trading up by about $0.06 at $4.33.
In India, the NMCE saw July deliveries rise by a rupee to around Rs208 ($4.63) per kilo
In China, the Shanghai Futures Exchange also saw prices rise by a fraction of a yuan, with July deliveries trading at around Yuan 32.7 ($5.05) per kilo.
Oil rises above $94 amid US crude supply drop
June 29, 2011
AP – Oil prices rose above $94 a barrel Wednesday on hopes that Greece will approve a crucial austerity package and after a report showed a drop in U.S. crude supplies, suggesting improved demand.
By early afternoon in Europe, benchmark oil for August delivery was up $1.17 to $94.06 a barrel in electronic trading on the New York Mercantile Exchange. Crude gained $2.28 to settle at $92.89 on Tuesday.
In London, Brent crude for August delivery was up $1.85 to $110.63 a barrel on the ICE Futures exchange.
Markets were awaiting a vote by Greek lawmakers later Wednesday on a $40 billion austerity plan. European officials say the government spending cuts are a necessary condition to receive the next installment of Greece’s $156 billion bailout loan from the European Union and the International Monetary Fund, and avert a debt default.
Hours of rioting by protesters against the austerity plan outside Greece’s parliament in Athens left 46 people injured Tuesday and clashes with police were continuing Wednesday.
Shortly before the vote, an opposition deputy said she would back the unpopular bill, boosting chances the measures will be passed.
“Investors appear to be pricing in an orderly resolution to the Greek debt crisis,” Ritterbusch and Associates said in a report. “However, any missteps toward the approval of a Greek austerity package could quickly reverse gains.”
Rising confidence in the approval of the Greek austerity deal also helped weaken the dollar, making crude cheaper for investors.
The euro was up to $1.4434 on Wednesday from $1.4364 late Tuesday in New York.
The American Petroleum Institute, meanwhile, said late Tuesday that crude inventories fell 2.7 million barrels last week while analysts surveyed by Platts, the energy information arm of McGraw-Hill Cos., had predicted a drop of 1.7 million barrels.
Inventories of gasoline dropped 91,000 barrels last week while distillates fell 945,000 barrels, the API said.
The Energy Department’s Energy Information Administration reports its weekly supply data later Wednesday.
Crude has dropped from near $115 early last month amid concerns about slowing demand from the U.S. and Europe. Oil had surged from $84 in February, pinching consumer spending and helping to slow economic growth.
“There is little doubt that the jump in the price of oil earlier this year is an important reason why the global economy has lost momentum,” Capital Economics said in a report.
“The recent fall in oil prices should help prevent what would otherwise have been an imminent double-dip (recession), but it will not be enough to rescue the world economy from a prolonged period of sluggish growth.”
Capital Economics said it estimates a $20 fall in the price of oil increases global demand and economic activity by 0.5 percent.
In other Nymex trading in July contracts, heating oil added 5.85 cents to $2.8842 a gallon while gasoline gained 2.4 cents at $2.9136 a gallon. Natural gas futures fell 2.3 cents to $4.331 per 1,000 cubic feet.
India rubber futures may maintain momentum as crude climbs
June 29, 2011
KOCHI (Commodity Online): India natural rubber futures may maintain the momentum in the coming days, riding the wave of crude oil prices. But a sharp uptrend is unlikely as the drag on prices would be there as supply situation in Thailand is robust.
Besides, the weather condition in Kerala—a major rubber prodcing state in India– is favourable for tapping.
All natural rubber contracts on the TCOCM are trading in green with the far month December contract gaining the maximum of 9.4 yen and trading at 347.3 yen as on 13.55 JST(10.30 IST). The near month July contract is trading at 358 yen, gaining 5 yen.
On the NMCE, natural rubber far month October contract and the near month July contract are trading in green even as the August and September contracts are trading in red. The July contract opened at the NMCE for Rs.20900, touched a high of Rs.21,100 and a low of Rs.20,830 before being traded at Rs.20,832. The October contract opened at a high of Rs.20, 825, touched a low of Rs.20750 and was seen trading at the same price.
With global concerns regarding the Greek economy easing a bit and crude stockpiles in US dropping, Oil traded near a four-day high in New York.
August crude was at $92.90, up 1 cent, in electronic trading on the New York Mercantile Exchange at 1:35 p.m. Sydney time. The contract on Tuesday gained $2.28, or 2.5 percent, to $92.89, the highest close since June 22, reported Bloomberg.
Cash for rubber move to cut middlemen
June 29, 2011
KOTA KINABALU: The Sabah Rubber Industry Board (SRIB) is promising smallholders that it will buy their produce using cash in a move to eliminate middlemen.
Newly-appointed SRIB chairman Ahmad Bujang has assured that all purchases will be done in cash.
“SRIB is now paying cash for rubber it purchases from smallholders in the farm,” said Ahmad who visited Keningau two days ago to talk to smallholders about their problems.
The move comes amid complaints from smallholders that SRIB failed to pay cash previously and this forced them to sell rubber to middlemen at a lower price as they needed the cash.
Ahmad advised smallholders to produce good quality Grade 1 rubber in order to fetch a higher price.
He said the Government, through SRIB, had provided financial assistance to smallholders in the state in the form of grants to plant and re-plant rubber trees.
He urged smallholders to continue giving their full support to SRIB by selling their rubber to the board.
“For the convenience of small-holders, SRIB would study the possibility of setting up collection stations in villages,” he said.
Thursday, June 30, 2011
Wednesday, June 29, 2011
Rubber hits 3-month low at Rs 210
Rubber hits 3-month low at Rs.210
June 27, 2011
New Delhi, Jun 27 (PTI) Natural rubber prices today fell by Rs 6 to hit a nearly three month low of Rs 210 per kg in line with the fall in prices in the global markets.
Natural rubber prices on Saturday were ruling at Rs 216 per kg in the domestic markets, according to the Rubber Board.
“Prices of natural rubber have fallen due to weak global markets that have been affected because of reports of China”s growth not being on projected lines,” Cochin Rubber Merchants Association Ex-President N Radhakrishnan told PTI.
According to Radhakrishnan, reports indicate that economic growth in China – the largest consumer of natural rubber — is not on projected lines.
The rate of natural rubber in the international physical market at Bangkok today fell by Rs 3.17 to Rs 209.46 per kg as compared to Rs 212.63 per kg on June 24, the Rubber Board data said.
Analysts also attributed the fall in the domestic markets to the global prices of crumb rubber, that are ruling at Rs 193-194 per kg signifying strong possibility of import by domestic consuming industry.
The future markets both domestic and international also have been down, which have further affected the domestic spot prices.
At the National Multi Commodity Exchange (NMCE), rubber future prices for July delivery lost Rs 383 at last trading price at the end of today”s first session at Rs 20,699 per quintal.
TOCOM (Tokyo Commodity Exchange) that were weak during the day recovered after the afternoon session with futures prices for July delivery ruling 361.4 yen (Rs 201.36), slightly up by 3.4 yen (Rs 1.89), from its last settlement price.
According to analysts, the weak trend could continue further due to sluggish demand from the domestic consuming industry, which is facing high inventory costs and low global prices that indicate increased prospect for imports.
Spot rubber slips on buyer resistance
KOTTAYAM, JUNE 28:
Physical rubber prices weakened on Tuesday. The market slipped further on buyer resistance extending the previous day's steep declines. According to sources, the losses were limited on marginal improvement in domestic futures and there were no quantity buyers in the trading houses even during the closing hours.
Except supply, all factors now stay unfavourable to natural rubber (NR) market according to the Association of Natural Rubber Producing Countries. While supply of NR continues to be low, the market sentiments are slightly overweighed by growing concerns about global economy; a weak demand for the commodity; depreciation of Thai baht, Malaysian ringgit and Indonesian Rupiah against the dollar; and strengthening of Japanese yen.
In spot, sheet rubber slipped to Rs 206 (207) a kg, according to traders. The grade weakened to Rs 207 (210) a kg both at Kottayam and Kochi, as reported by the Rubber Board.
In futures, the July series recovered partially to Rs 208.30 (206.73), August to Rs 209.42 (207.37), September to Rs 208.10 (206.57), October to Rs 207.25 (204.99), November to Rs 210.90 (208.23) and December to Rs 211.45 (210.05) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 (spot) dropped to Rs 207.49 (209.46) a kg at Bangkok. The July futures closed unchanged at ¥358.0 (Rs 199.37) a kg during the day session but then improved marginally to ¥361 (Rs 201.08) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 206 (207); RSS-5: 204 (205); ungraded: 201 (202); ISNR 20: 203 (206) and latex 60 per cent 132 (132).
Tokyo futures rebound but gains seen limited
June 28, 2011
TOKYO, June 28(Reuters) – Tokyo rubber futures climbed 2.2 percent early on Tuesday after shares rallied and oil prices rose on easing worries over Greece, but gains will likely be limited as downward pressure remains strong amid lingering uncertainty over the global economy.
FUNDAMENTALS
* The key Tokyo Commodity Exchange rubber contract for December delivery <0#2JRU:> was up 7.5 yen, or 2.2 percent, at 352.5 yen per kg as of 0040 GMT. The benchmark index fell as low as 344.0 yen, its lowest since mid-March, on Monday.
* The most-active Shanghai rubber contract for September delivery dropped 1,425 yuan on Monday to finish at 30,725 yuan ($4,745.169) per tonne.
* The dollar fell against the yen and euro as investors bet Greece’s parliament will approve a fiscal austerity package needed for the country to get emergency aid and avoid defaulting on its debt.
* Brent crude oil futures settled higher on Monday, lifted by the euro’s gains against the greenback.
* Rubber supply in Thailand, the world’s biggest rubber producer and exporter, will likely rise further in July as rains stopped, allowing farmers to tap more latex.
* For the top stories in rubber market and other news, click , or
MARKET NEWS
* Nissan Motor outlined plans to boost both its global market share and profit margin to 8 percent within six years, promising a new vehicle every six weeks on average to woo consumers away from rivals.
* The Nikkei average jumped on Tuesday, tracking gains in Wall Street shares.
* U.S. stocks gained following three days of losses on Monday, led by banks after news of more favorable capital requirements and optimism over Greece’s austerity plan.
Rubber stocks gain on customs duty abolish news
June 28, 2011
Finance Ministry may abolish customs duty on rubber up to 1 lakh tonne, reports CNBC-TV18. The Commerce Ministry has proposed removal of 20% duty on the commodity likely due to rising domestic rubber prices.
Ceat touched an intraday high of Rs 103.95 and an intraday low of Rs 94.70. At 13:09 hrs the share was quoting at Rs 103.00, up Rs 7.80, or 8.19%. It was trading with volumes of 181,741 shares.
JK Tyre and Industries touched an intraday high of Rs 102.60 and an intraday low of Rs 95. At 13:08 hrs the share was quoting at Rs 101.85, up Rs 7, or 7.38%. It was trading with volumes of 58,391 shares.
Apollo Tyres touched an intraday high of Rs 78.90 and an intraday low of Rs 76.60. At 13:08 hrs the share was quoting at Rs 78.50, up Rs 2.15, or 2.82%. It was trading with volumes of 536,746 shares.
Goodyear India touched an intraday high of Rs 327.70 and an intraday low of Rs 314. At 13:07 hrs the share was quoting at Rs 324.80, up Rs 9.40, or 2.98%. It was trading with volumes of 29,535 shares.
MRF touched an intraday high of Rs 6,870 and an intraday low of Rs 6,618. At 13:08 hrs the share was quoting at Rs 6,840, up Rs 259.85, or 3.95%. It was trading with volumes of 6,543 shares.
Oil falls as Greek debt worries persist
June 28, 2011
SINGAPORE (Reuters) – Brent fell towards $105 a barrel on Tuesday as concerns of the debt crisis spreading across Europe dogged investors despite a radical French proposal to rollover Greek debt.
President Nicolas Sarkozy said that French banks had reached a draft agreement with the authorities on a voluntary rollover of maturing bonds, as markets anxiously awaited the outcome of a vote in Greece to approve unpopular fiscal austerity measures.
ICE Brent crude for August was down 49 cents to $105.50 a barrel by 0600 GMT (7 a.m. British time) after hitting an intraday high of $106.84. U.S. crude fell 4 cents to $90.57 barrel, but it held above the front-month 250-day moving average of $89.45.
“Crude oil markets are retreating from the early rally in the absence of positive newsflow,” ANZ analyst Serene Lim said. “Investors are cautious ahead of the key Greek parliamentary votes tomorrow.”
Investors are still watching to see if Greece’s parliament will approve austerity steps that are a precondition for international aid that the country needs to avoid a default.
Prices were expected to remain volatile as some investors were still worried about the result of the Greek vote, said Ken Hasegawa, a commodity sales manager at Newedge Japan.
“WTI may be supported around $90, but any upside will be limited because of concerns about the economy in the euro zone,” he said.
This could keep Brent’s premium to WTI in a range between $13 and $15 a barrel, he added.
EURO EYED
The euro was steady on Tuesday and the dollar slightly weaker against major currencies <.DXY>, stalling just below chart resistance, as investors awaited the Greek vote.
Without approval, the European Union and the International Monetary Fund say they will not disburse the fifth trance of Greece’s 110 billion-euro bailout programme. Athens needs the aid to pay its bills next month and avert the euro zone’s first sovereign default.
“If they fail to get an agreement, oil prices will fall,” Hasegawa said.
A surprise announcement by the International Energy Agency to release oil from strategic reserves has likely been priced in after Brent fell 7 percent last week, he added.
“Fundamentally, I don’t think that will have a big impact on the market … as the 60 million barrels of oil can be absorbed easily,” he said.
South Korea will start to release 3.46 million barrels of oil, including 2 million barrels of crude and 1.46 million barrels of products by “today at the earliest,” a source at the economy ministry said.
A drop in prices may lift gasoline consumption in the United States, Hasegawa said, easing concerns of demand destruction at the world’s largest oil user.
The market is also gearing up for a fall in crude inventories in the United States in industry data due late Tuesday. Analysts are expecting stocks to shrink for the fourth week in a row.
Investors were also watching events in Libya, after the International Criminal Court issued an arrest warrant on Monday for leader Muammar Gaddafi, and rebels trying to oust him said their forces had advanced to within 80 km (50 miles) of the capital.
Tokyo futures hit 3-1/2 month low on supply, Euro debt crisis
June 27, 2011
BANGKOK: Tokyo rubber futures tumbled to 3-1/2 month low on Monday, weighed by rising supply in major producing countries and concerns about Europe’s debt, which has triggered a broad sell-off in commodities, dealers said.
The benchmark rubber contract on the Tokyo Commodity Exchange for December delivery fell 8 yen, or 2.3 percent, from the opening prices to settle at 345.0 yen ($4.289) per kg.
It fell as low as 344.0 yen, the lowest since mid-March.
The front-month June contract expired on Friday and deliveries against the June rubber futures contract fell 39 percent from May to 146 lots or 730 tonnes.
The most-active Shanghai rubber contract for September delivery fell 1,425 yuan to finish at 30,725 yuan ($4,745.169)per tonne.
“Rubber could fall gradually due to rising supply in Thailand, but we have another big negative factor of Europe debt concerns that dragged TOCOM prices down deeper than expected,” one dealer said.
Greece’s parliament begins on Monday to debate a deeply unpopular austerity plan which international lenders are demanding to see approved this week to avert the threat of bankruptcy.
Rubber supply in Thailand, the world’s biggest rubber producer and exporter, was expected to rise further in July as rains stopped and allowed farmers to tap more latex, said a trader in Thailand’s southern Hat Yai rubber centre.
However, traders said they expected TOCOM prices to rebound on Tuesday, expecting prices to find a strong support level at around 340 yen, while demand on the physical front should lend support.
OIL PRICES LOWER, DOWN 8% IN 2 WEEKS
June 27, 2011
New York oil prices fell further on Monday, while London Brent surged amid easing supplies and fears of a default by debt-ridden Greece which could hit demand for energy.
New York’s main contract, West Texas Intermediate (WTI) light, sweet crude for delivery in August, dropped 55 cents to close at $US90.61 a barrel.
WTI has fallen around eight per cent in the past two weeks, and was hit hard last week when the International Energy Agency decided to tap strategic oil stocks in a bid to rein in high-flying energy prices.
In London, Brent North Sea crude for August delivery gained 88 cents to close at $US105.99 a barrel on the Intercontinental Exchange, regaining some ground after it shed about nine dollars on Thursday and Friday.
Analysts said the markets were still reeling from the IEA’s surprise move to release 60 million barrels over the course of a month, half of which will come from the United States’ strategic petroleum reserve (SPR).
“The SPR is definitely weighing on the market,” said Richard Ilczyszyn, senior market strategist at Lind Waldock.
“In this time of the year, I wouldn’t expect the market to do a whole lot because we’ve had a pretty good sell-off. I don’t think the market can break much lower than that because we are still in driving season.”
The IEA, which represents 28 oil-importing countries, authorised last week’s drawdown to make up for lost output from Libya, where a mass uprising against leader Moamer Kadhafi has practically halted oil production.
Also clouding the US market was new data showing that American consumers have tightened spending.
The Commerce Department reported Monday that consumer spending in May was virtually unchanged from April — a sign of how sluggish the economy has become, and how much high gasoline prices had impacted US households.
Ker Chung Yang, an analyst with Phillip Futures in Singapore, said that investors remained concerned over the possible fallout from Greece’s debt crisis.
“Crude oil prices will stay volatile as the greater concern is still on Greece and the overall recovery of the US economy,” Ker said.
Greece faces a momentous battle in parliament this week to quash dissent over additional austerity reforms needed to secure a vital new bailout from the European Union and the International Monetary Fund.
The EU and IMF have been struggling to prevent a default by Greece that could have potentially destabilising effects throughout the eurozone and beyond.
Oil near $91 as Greece austerity vote awaited
June 28, 2011
SINGAPORE (AP) — Oil prices inched higher to near $91 a barrel Tuesday in Asia as investors mulled whether Greece will approve more austerity measures this week to receive the next round of international aid and avert a debt default.
Benchmark oil for August delivery was up 26 cents to $90.87 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. Crude fell 55 cents to settle at $90.61 on Friday.
In London, Brent crude for August delivery was down 3 cents to $105.96 a barrel on the ICE Futures exchange.
Greek lawmakers will vote Wednesday on a $40 billion austerity plan, government spending cuts that European officials say are a necessary condition to receive the next installment of Greece’s $156 billion bailout loan from the European Union and the International Monetary Fund.
If Greece rejects the cuts, it could lead to a debt default and spread instability in other financially troubled European countries.
“Most observers expect the Greeks to understand just how much is at stake,” energy consultant Cameron Hanover said in a report. “Contrarians argue that Greece’s people may decide there is less pain in a default than in austerity.”
Weakness in the U.S. economy is also on the radar. The Commerce Department said Monday that U.S. consumer spending was unchanged in May, the worst result since September 2009. When adjusted for inflation, spending dropped slightly.
In other Nymex trading in July contracts, heating oil slipped 0.5 cent to $2.76 a gallon while gasoline gained 1.6 cents at $2.82 a gallon. Natural gas futures rose 2.3 cents at $4.28 per 1,000 cubic feet.
Tyre makers rise on falling rubber prices; Ceat up 15 pct
June 28, 2011
Shares of tyre manufacturers were trading sharply higher on fund buying tracking a fall in natural rubber prices, several dealers said.
Spot rubber price has fallen over 6 percent since the beginning of this month to 21,000 rupees per 100 kg in the key Kottayam market in Kerala, data with the state-run Rubber Board showed. Prices of rubber constitutes 40 percent of the tyre production cost.
At 3.02 p.m., shares of Ceat , JK Tyre and Industries , MRF Ltd and Apollo Tyres were up 3-15 percent.
Who Says China Inflation is Under Control
June 28, 2011
On June 23 the Financial Times carried an article written by China’s Prime Minister Wen Jiabao in which he argued that macro-economic measures taken by the government over the last year had contained inflation. Since 2010, the government has increased required reserve ratios 12 times for banks and quadrupled interest rates.
Wen’s remarks calmed investors, who were hoping that cooling policies were reaching an end. The Shanghai A-share index (Shanghai Stock Exchange: .ssea) shot up 2.16 percent, and Hong Kong’s Hang Seng (Hong Kong Stock Exchange: .hsi) 1.90 percent the day after Wen’s article was published.
On Monday, however, Wen, who is traveling to Europe, was quoted by the Hong Kong Media as saying for the first time that China will find it hard to keep inflation below 4 per cent in 2011. The markets though chose to react more to his earlier remarks.
Conventional wisdom of most economists is that China’s headline inflation is under control. Jim O’Neill, Chairman of Goldman Sachs’ Asset Management, argued this, and an analyst at Royal Bank of Canada agreed and wrote: “The fact that Wen is now predicting price pressures will ease despite these near-term risks suggests that he has received relatively firm assurances from his economic advisers that the situation is set to improve in coming months.”
O’Neill and RBC must be looking at a different China than the one in which I operate a business and face soaring salaries and rents. It is true China does not face 20 percent annual inflation like Vietnam; however, measures should not be loosened in July as many analysts predict will happen when China’s top leaders gather to discuss economic policy for the second half of the year. Even if official inflation is under control, food prices soared 11.7 percent in May as drought and Japan’s nuclear disaster have damaged the food supply chain.
Contrary to what O’Neill and RBC think, things will only get worse in the short-term as multinationals start to transfer higher costs to consumers and as new university graduates enter the labor force in July.
My firm has interviewed several dozen large multinationals in the past month. Fearful of incurring the wrath of the Chinese government as Unilever (Euronext Amsterdam: una-nl) did for announcing price hikes, many reported delaying raising prices but would strongly consider raising them in the next quarter. Instead, Coca-Cola (NYSE: ko) and Pepsi (NYSE: pep) shrunk bottle sizes from 600 ml to 500 ml. YUM Brands! (NYSE: yum) and Starbucks (NASDAQ: sbux) added more expensive items, but McDonald’s (NYSE: mcd) raised prices.
I asked my office landlord recently if rent would go up 10 percent when our contract ends at the end of this year. She laughed and told me 20-30 percent at least. Taxi prices will rise 20 percent in Shanghai and other cities soon. The Shanghai government has said taxi fares will be raised after the public discussion period in June. Fuel surcharges have also gone up in Shenzhen and Beijing.
Plus tax breaks implemented during the crisis are being rescinded. In other words, a perfect storm of rising wages, rents and commodities will force most companies to begin transferring prices to the end consumer. With brownouts set to hit 10 manufacturing oriented provinces this summer, pricing pressures will only continue.
In order to stave off potentially destabilizing inflation and a housing bubble, the government should leave tightening measures in place in the short-term. Until the U.S. dollar regains its strength or America ends its wars in the Middle East, causing commodity prices to drop, there is no way inflation is a short-term issue for China.
Measures to cool the economy are creating massive pent up demand in a number of sectors. For the past year and a half, transactions in the residential real estate market have essentially come to a stop. Aside from multi-million dollar mega mansions whose prices are soaring, sales volumes are down 70 percent in Shanghai and prices are remaining flat or even dropping as stringent measures and reduced access to credit freeze the market.
If restrictions are eased, another bull market in the real estate sector will appear, due to the many investors and younger couples who have been sitting on the sidelines. Proof of the pent up demand is that Chinese have been looking to invest abroad more. Vancouver’s real estate prices last year rose 14 percent because of the influx of mainland Chinese money, and according to Canada’s Frontier Centre for Public Policy is now the third most expensive English speaking city in the world after Hong Kong and Sydney (also favorite investment spots for mainland Chinese).
The world is now too economically interrelated to assume inflation in China won’t affect the world economy. Export prices to America are already increasing, and many companies like Nike (NYSE: nke) are shifting production away from China to cheaper markets like Indonesia. While the Chinese government is implementing the right measures and acting forcefully to stop inflation, there are no easy solutions.
Ben Bernanke’s loose monetary policies over the past several years have scared investors away from the U.S. dollar towards developing markets and commodities.
If left unaddressed, China’s current dangerous inflation levels coupled with investors’ increasing interest in the China market can only lead to higher prices for the world market in the short and long term.
June 27, 2011
New Delhi, Jun 27 (PTI) Natural rubber prices today fell by Rs 6 to hit a nearly three month low of Rs 210 per kg in line with the fall in prices in the global markets.
Natural rubber prices on Saturday were ruling at Rs 216 per kg in the domestic markets, according to the Rubber Board.
“Prices of natural rubber have fallen due to weak global markets that have been affected because of reports of China”s growth not being on projected lines,” Cochin Rubber Merchants Association Ex-President N Radhakrishnan told PTI.
According to Radhakrishnan, reports indicate that economic growth in China – the largest consumer of natural rubber — is not on projected lines.
The rate of natural rubber in the international physical market at Bangkok today fell by Rs 3.17 to Rs 209.46 per kg as compared to Rs 212.63 per kg on June 24, the Rubber Board data said.
Analysts also attributed the fall in the domestic markets to the global prices of crumb rubber, that are ruling at Rs 193-194 per kg signifying strong possibility of import by domestic consuming industry.
The future markets both domestic and international also have been down, which have further affected the domestic spot prices.
At the National Multi Commodity Exchange (NMCE), rubber future prices for July delivery lost Rs 383 at last trading price at the end of today”s first session at Rs 20,699 per quintal.
TOCOM (Tokyo Commodity Exchange) that were weak during the day recovered after the afternoon session with futures prices for July delivery ruling 361.4 yen (Rs 201.36), slightly up by 3.4 yen (Rs 1.89), from its last settlement price.
According to analysts, the weak trend could continue further due to sluggish demand from the domestic consuming industry, which is facing high inventory costs and low global prices that indicate increased prospect for imports.
Spot rubber slips on buyer resistance
KOTTAYAM, JUNE 28:
Physical rubber prices weakened on Tuesday. The market slipped further on buyer resistance extending the previous day's steep declines. According to sources, the losses were limited on marginal improvement in domestic futures and there were no quantity buyers in the trading houses even during the closing hours.
Except supply, all factors now stay unfavourable to natural rubber (NR) market according to the Association of Natural Rubber Producing Countries. While supply of NR continues to be low, the market sentiments are slightly overweighed by growing concerns about global economy; a weak demand for the commodity; depreciation of Thai baht, Malaysian ringgit and Indonesian Rupiah against the dollar; and strengthening of Japanese yen.
In spot, sheet rubber slipped to Rs 206 (207) a kg, according to traders. The grade weakened to Rs 207 (210) a kg both at Kottayam and Kochi, as reported by the Rubber Board.
In futures, the July series recovered partially to Rs 208.30 (206.73), August to Rs 209.42 (207.37), September to Rs 208.10 (206.57), October to Rs 207.25 (204.99), November to Rs 210.90 (208.23) and December to Rs 211.45 (210.05) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 (spot) dropped to Rs 207.49 (209.46) a kg at Bangkok. The July futures closed unchanged at ¥358.0 (Rs 199.37) a kg during the day session but then improved marginally to ¥361 (Rs 201.08) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 206 (207); RSS-5: 204 (205); ungraded: 201 (202); ISNR 20: 203 (206) and latex 60 per cent 132 (132).
Tokyo futures rebound but gains seen limited
June 28, 2011
TOKYO, June 28(Reuters) – Tokyo rubber futures climbed 2.2 percent early on Tuesday after shares rallied and oil prices rose on easing worries over Greece, but gains will likely be limited as downward pressure remains strong amid lingering uncertainty over the global economy.
FUNDAMENTALS
* The key Tokyo Commodity Exchange rubber contract for December delivery <0#2JRU:> was up 7.5 yen, or 2.2 percent, at 352.5 yen per kg as of 0040 GMT. The benchmark index fell as low as 344.0 yen, its lowest since mid-March, on Monday.
* The most-active Shanghai rubber contract for September delivery dropped 1,425 yuan on Monday to finish at 30,725 yuan ($4,745.169) per tonne.
* The dollar fell against the yen and euro as investors bet Greece’s parliament will approve a fiscal austerity package needed for the country to get emergency aid and avoid defaulting on its debt.
* Brent crude oil futures settled higher on Monday, lifted by the euro’s gains against the greenback.
* Rubber supply in Thailand, the world’s biggest rubber producer and exporter, will likely rise further in July as rains stopped, allowing farmers to tap more latex.
* For the top stories in rubber market and other news, click , or
MARKET NEWS
* Nissan Motor outlined plans to boost both its global market share and profit margin to 8 percent within six years, promising a new vehicle every six weeks on average to woo consumers away from rivals.
* The Nikkei average jumped on Tuesday, tracking gains in Wall Street shares.
* U.S. stocks gained following three days of losses on Monday, led by banks after news of more favorable capital requirements and optimism over Greece’s austerity plan.
Rubber stocks gain on customs duty abolish news
June 28, 2011
Finance Ministry may abolish customs duty on rubber up to 1 lakh tonne, reports CNBC-TV18. The Commerce Ministry has proposed removal of 20% duty on the commodity likely due to rising domestic rubber prices.
Ceat touched an intraday high of Rs 103.95 and an intraday low of Rs 94.70. At 13:09 hrs the share was quoting at Rs 103.00, up Rs 7.80, or 8.19%. It was trading with volumes of 181,741 shares.
JK Tyre and Industries touched an intraday high of Rs 102.60 and an intraday low of Rs 95. At 13:08 hrs the share was quoting at Rs 101.85, up Rs 7, or 7.38%. It was trading with volumes of 58,391 shares.
Apollo Tyres touched an intraday high of Rs 78.90 and an intraday low of Rs 76.60. At 13:08 hrs the share was quoting at Rs 78.50, up Rs 2.15, or 2.82%. It was trading with volumes of 536,746 shares.
Goodyear India touched an intraday high of Rs 327.70 and an intraday low of Rs 314. At 13:07 hrs the share was quoting at Rs 324.80, up Rs 9.40, or 2.98%. It was trading with volumes of 29,535 shares.
MRF touched an intraday high of Rs 6,870 and an intraday low of Rs 6,618. At 13:08 hrs the share was quoting at Rs 6,840, up Rs 259.85, or 3.95%. It was trading with volumes of 6,543 shares.
Oil falls as Greek debt worries persist
June 28, 2011
SINGAPORE (Reuters) – Brent fell towards $105 a barrel on Tuesday as concerns of the debt crisis spreading across Europe dogged investors despite a radical French proposal to rollover Greek debt.
President Nicolas Sarkozy said that French banks had reached a draft agreement with the authorities on a voluntary rollover of maturing bonds, as markets anxiously awaited the outcome of a vote in Greece to approve unpopular fiscal austerity measures.
ICE Brent crude for August was down 49 cents to $105.50 a barrel by 0600 GMT (7 a.m. British time) after hitting an intraday high of $106.84. U.S. crude fell 4 cents to $90.57 barrel, but it held above the front-month 250-day moving average of $89.45.
“Crude oil markets are retreating from the early rally in the absence of positive newsflow,” ANZ analyst Serene Lim said. “Investors are cautious ahead of the key Greek parliamentary votes tomorrow.”
Investors are still watching to see if Greece’s parliament will approve austerity steps that are a precondition for international aid that the country needs to avoid a default.
Prices were expected to remain volatile as some investors were still worried about the result of the Greek vote, said Ken Hasegawa, a commodity sales manager at Newedge Japan.
“WTI may be supported around $90, but any upside will be limited because of concerns about the economy in the euro zone,” he said.
This could keep Brent’s premium to WTI in a range between $13 and $15 a barrel, he added.
EURO EYED
The euro was steady on Tuesday and the dollar slightly weaker against major currencies <.DXY>, stalling just below chart resistance, as investors awaited the Greek vote.
Without approval, the European Union and the International Monetary Fund say they will not disburse the fifth trance of Greece’s 110 billion-euro bailout programme. Athens needs the aid to pay its bills next month and avert the euro zone’s first sovereign default.
“If they fail to get an agreement, oil prices will fall,” Hasegawa said.
A surprise announcement by the International Energy Agency to release oil from strategic reserves has likely been priced in after Brent fell 7 percent last week, he added.
“Fundamentally, I don’t think that will have a big impact on the market … as the 60 million barrels of oil can be absorbed easily,” he said.
South Korea will start to release 3.46 million barrels of oil, including 2 million barrels of crude and 1.46 million barrels of products by “today at the earliest,” a source at the economy ministry said.
A drop in prices may lift gasoline consumption in the United States, Hasegawa said, easing concerns of demand destruction at the world’s largest oil user.
The market is also gearing up for a fall in crude inventories in the United States in industry data due late Tuesday. Analysts are expecting stocks to shrink for the fourth week in a row.
Investors were also watching events in Libya, after the International Criminal Court issued an arrest warrant on Monday for leader Muammar Gaddafi, and rebels trying to oust him said their forces had advanced to within 80 km (50 miles) of the capital.
Tokyo futures hit 3-1/2 month low on supply, Euro debt crisis
June 27, 2011
BANGKOK: Tokyo rubber futures tumbled to 3-1/2 month low on Monday, weighed by rising supply in major producing countries and concerns about Europe’s debt, which has triggered a broad sell-off in commodities, dealers said.
The benchmark rubber contract on the Tokyo Commodity Exchange for December delivery fell 8 yen, or 2.3 percent, from the opening prices to settle at 345.0 yen ($4.289) per kg.
It fell as low as 344.0 yen, the lowest since mid-March.
The front-month June contract expired on Friday and deliveries against the June rubber futures contract fell 39 percent from May to 146 lots or 730 tonnes.
The most-active Shanghai rubber contract for September delivery fell 1,425 yuan to finish at 30,725 yuan ($4,745.169)per tonne.
“Rubber could fall gradually due to rising supply in Thailand, but we have another big negative factor of Europe debt concerns that dragged TOCOM prices down deeper than expected,” one dealer said.
Greece’s parliament begins on Monday to debate a deeply unpopular austerity plan which international lenders are demanding to see approved this week to avert the threat of bankruptcy.
Rubber supply in Thailand, the world’s biggest rubber producer and exporter, was expected to rise further in July as rains stopped and allowed farmers to tap more latex, said a trader in Thailand’s southern Hat Yai rubber centre.
However, traders said they expected TOCOM prices to rebound on Tuesday, expecting prices to find a strong support level at around 340 yen, while demand on the physical front should lend support.
OIL PRICES LOWER, DOWN 8% IN 2 WEEKS
June 27, 2011
New York oil prices fell further on Monday, while London Brent surged amid easing supplies and fears of a default by debt-ridden Greece which could hit demand for energy.
New York’s main contract, West Texas Intermediate (WTI) light, sweet crude for delivery in August, dropped 55 cents to close at $US90.61 a barrel.
WTI has fallen around eight per cent in the past two weeks, and was hit hard last week when the International Energy Agency decided to tap strategic oil stocks in a bid to rein in high-flying energy prices.
In London, Brent North Sea crude for August delivery gained 88 cents to close at $US105.99 a barrel on the Intercontinental Exchange, regaining some ground after it shed about nine dollars on Thursday and Friday.
Analysts said the markets were still reeling from the IEA’s surprise move to release 60 million barrels over the course of a month, half of which will come from the United States’ strategic petroleum reserve (SPR).
“The SPR is definitely weighing on the market,” said Richard Ilczyszyn, senior market strategist at Lind Waldock.
“In this time of the year, I wouldn’t expect the market to do a whole lot because we’ve had a pretty good sell-off. I don’t think the market can break much lower than that because we are still in driving season.”
The IEA, which represents 28 oil-importing countries, authorised last week’s drawdown to make up for lost output from Libya, where a mass uprising against leader Moamer Kadhafi has practically halted oil production.
Also clouding the US market was new data showing that American consumers have tightened spending.
The Commerce Department reported Monday that consumer spending in May was virtually unchanged from April — a sign of how sluggish the economy has become, and how much high gasoline prices had impacted US households.
Ker Chung Yang, an analyst with Phillip Futures in Singapore, said that investors remained concerned over the possible fallout from Greece’s debt crisis.
“Crude oil prices will stay volatile as the greater concern is still on Greece and the overall recovery of the US economy,” Ker said.
Greece faces a momentous battle in parliament this week to quash dissent over additional austerity reforms needed to secure a vital new bailout from the European Union and the International Monetary Fund.
The EU and IMF have been struggling to prevent a default by Greece that could have potentially destabilising effects throughout the eurozone and beyond.
Oil near $91 as Greece austerity vote awaited
June 28, 2011
SINGAPORE (AP) — Oil prices inched higher to near $91 a barrel Tuesday in Asia as investors mulled whether Greece will approve more austerity measures this week to receive the next round of international aid and avert a debt default.
Benchmark oil for August delivery was up 26 cents to $90.87 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. Crude fell 55 cents to settle at $90.61 on Friday.
In London, Brent crude for August delivery was down 3 cents to $105.96 a barrel on the ICE Futures exchange.
Greek lawmakers will vote Wednesday on a $40 billion austerity plan, government spending cuts that European officials say are a necessary condition to receive the next installment of Greece’s $156 billion bailout loan from the European Union and the International Monetary Fund.
If Greece rejects the cuts, it could lead to a debt default and spread instability in other financially troubled European countries.
“Most observers expect the Greeks to understand just how much is at stake,” energy consultant Cameron Hanover said in a report. “Contrarians argue that Greece’s people may decide there is less pain in a default than in austerity.”
Weakness in the U.S. economy is also on the radar. The Commerce Department said Monday that U.S. consumer spending was unchanged in May, the worst result since September 2009. When adjusted for inflation, spending dropped slightly.
In other Nymex trading in July contracts, heating oil slipped 0.5 cent to $2.76 a gallon while gasoline gained 1.6 cents at $2.82 a gallon. Natural gas futures rose 2.3 cents at $4.28 per 1,000 cubic feet.
Tyre makers rise on falling rubber prices; Ceat up 15 pct
June 28, 2011
Shares of tyre manufacturers were trading sharply higher on fund buying tracking a fall in natural rubber prices, several dealers said.
Spot rubber price has fallen over 6 percent since the beginning of this month to 21,000 rupees per 100 kg in the key Kottayam market in Kerala, data with the state-run Rubber Board showed. Prices of rubber constitutes 40 percent of the tyre production cost.
At 3.02 p.m., shares of Ceat , JK Tyre and Industries , MRF Ltd and Apollo Tyres were up 3-15 percent.
Who Says China Inflation is Under Control
June 28, 2011
On June 23 the Financial Times carried an article written by China’s Prime Minister Wen Jiabao in which he argued that macro-economic measures taken by the government over the last year had contained inflation. Since 2010, the government has increased required reserve ratios 12 times for banks and quadrupled interest rates.
Wen’s remarks calmed investors, who were hoping that cooling policies were reaching an end. The Shanghai A-share index (Shanghai Stock Exchange: .ssea) shot up 2.16 percent, and Hong Kong’s Hang Seng (Hong Kong Stock Exchange: .hsi) 1.90 percent the day after Wen’s article was published.
On Monday, however, Wen, who is traveling to Europe, was quoted by the Hong Kong Media as saying for the first time that China will find it hard to keep inflation below 4 per cent in 2011. The markets though chose to react more to his earlier remarks.
Conventional wisdom of most economists is that China’s headline inflation is under control. Jim O’Neill, Chairman of Goldman Sachs’ Asset Management, argued this, and an analyst at Royal Bank of Canada agreed and wrote: “The fact that Wen is now predicting price pressures will ease despite these near-term risks suggests that he has received relatively firm assurances from his economic advisers that the situation is set to improve in coming months.”
O’Neill and RBC must be looking at a different China than the one in which I operate a business and face soaring salaries and rents. It is true China does not face 20 percent annual inflation like Vietnam; however, measures should not be loosened in July as many analysts predict will happen when China’s top leaders gather to discuss economic policy for the second half of the year. Even if official inflation is under control, food prices soared 11.7 percent in May as drought and Japan’s nuclear disaster have damaged the food supply chain.
Contrary to what O’Neill and RBC think, things will only get worse in the short-term as multinationals start to transfer higher costs to consumers and as new university graduates enter the labor force in July.
My firm has interviewed several dozen large multinationals in the past month. Fearful of incurring the wrath of the Chinese government as Unilever (Euronext Amsterdam: una-nl) did for announcing price hikes, many reported delaying raising prices but would strongly consider raising them in the next quarter. Instead, Coca-Cola (NYSE: ko) and Pepsi (NYSE: pep) shrunk bottle sizes from 600 ml to 500 ml. YUM Brands! (NYSE: yum) and Starbucks (NASDAQ: sbux) added more expensive items, but McDonald’s (NYSE: mcd) raised prices.
I asked my office landlord recently if rent would go up 10 percent when our contract ends at the end of this year. She laughed and told me 20-30 percent at least. Taxi prices will rise 20 percent in Shanghai and other cities soon. The Shanghai government has said taxi fares will be raised after the public discussion period in June. Fuel surcharges have also gone up in Shenzhen and Beijing.
Plus tax breaks implemented during the crisis are being rescinded. In other words, a perfect storm of rising wages, rents and commodities will force most companies to begin transferring prices to the end consumer. With brownouts set to hit 10 manufacturing oriented provinces this summer, pricing pressures will only continue.
In order to stave off potentially destabilizing inflation and a housing bubble, the government should leave tightening measures in place in the short-term. Until the U.S. dollar regains its strength or America ends its wars in the Middle East, causing commodity prices to drop, there is no way inflation is a short-term issue for China.
Measures to cool the economy are creating massive pent up demand in a number of sectors. For the past year and a half, transactions in the residential real estate market have essentially come to a stop. Aside from multi-million dollar mega mansions whose prices are soaring, sales volumes are down 70 percent in Shanghai and prices are remaining flat or even dropping as stringent measures and reduced access to credit freeze the market.
If restrictions are eased, another bull market in the real estate sector will appear, due to the many investors and younger couples who have been sitting on the sidelines. Proof of the pent up demand is that Chinese have been looking to invest abroad more. Vancouver’s real estate prices last year rose 14 percent because of the influx of mainland Chinese money, and according to Canada’s Frontier Centre for Public Policy is now the third most expensive English speaking city in the world after Hong Kong and Sydney (also favorite investment spots for mainland Chinese).
The world is now too economically interrelated to assume inflation in China won’t affect the world economy. Export prices to America are already increasing, and many companies like Nike (NYSE: nke) are shifting production away from China to cheaper markets like Indonesia. While the Chinese government is implementing the right measures and acting forcefully to stop inflation, there are no easy solutions.
Ben Bernanke’s loose monetary policies over the past several years have scared investors away from the U.S. dollar towards developing markets and commodities.
If left unaddressed, China’s current dangerous inflation levels coupled with investors’ increasing interest in the China market can only lead to higher prices for the world market in the short and long term.
Friday, June 24, 2011
Rubber loses further onlack of buyers.
Rubber loses further onlack of buyers.
KOTTAYAM, JUNE 23:
Physical rubber prices continued to remain in a corrective phase on Thursday. The market made further losses mainly in the absence of buyers though there was no selling pressure from dealers or growers. Sharp declines in the international markets and a bearish outlook in the domestic futures were the guiding factors that kept the traders mostly on sidelines during the day. The transactions were low.
Though there has been an upswing consistently for the last few months in rubber prices, of late there is a set back to the rubber sector and some small units have shut down , according to Mr George Valy, President, Indian rubber Dealers Federation. The Chinese absence in the international market contributed considerably to the current decline. The tyre production is now at a slow pace and it has badly affected the automobile sector also. The market is now at a downward journey before it settles at a stage which should be acceptable to growers as well, Mr Valy observed
Sheet rubber weakened to Rs. 216.50 (217.50) a kg, according to traders. The grade moved down to Rs 217.00 (218.00) a kg both at Kottayam and Kochi, as reported by the Rubber Board.
In futures, the July series recovered marginally to Rs 213.90 (212.23), August to Rs 216.08 (215.32), September to Rs 215.94 (214.54) and December to Rs 217.90 (216.20) while the October series dropped to Rs 214.51 (214.74) and November to Rs 215.00 (218.20) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 (spot) declined to Rs 215.26 (221.73) a kg at Bangkok. The June futures nosedived to ¥ 377.9 (Rs 210.78) from ¥ 393.0 a kg during the day session and then slipped to ¥ 375.7 (Rs 209.54) in the night session on Tokyo Commodity Exchange.
Spot rubber rates (Rs/kg) were: RSS-4: 216.50 (217.50); RSS-5: 214.00 (215.00); Ungraded: 211.00 (213.00); ISNR 20: 213.00 (215.00) and Latex 60 per cent: 135.00 (137.00)
Soaring BR prices may trigger switch to NR – ICIS
June 23, 2011
Singapore — International analysts, ICIS are reporting that Asian tyre makers may switch away from synthetic rubber toward natural rubber (NR) if NR prices fall below $4/kg, based on the high cost of butadiene and polybutadiene rubber.
Spot BR prices increased by $175/tonne to around $4,300-4,550/tonne CFR (cost and freight) SE (southeast) Asia on 16 June, according to ICIS. Offers for July and August BR, meanwhile, were at $4,800-5,000/tonne CFR Asia, up by $200-300/tonne from the previous month, market sources said.
While BR and NR are not direct replacements, as suggested by ICIS, tyre makers do have some flexibility to substitute into or awaw from NR in their replacement tyres. Estimates of the potential for substitution vary, but average around 10 percent of global volume.
Tokyo NR prices sink to $4.46 (June 23)
June 23, 2011
On Tokyo’s Tocom Exchange, prices for the six-month contract moved down by yen 3 overnight, to close at yen 359 ($4.46) per kg on Thursday 23 June. Shorter-dated prices moved down, trading at around yen 370.
In Singapore, SGX said September RSS3 was around $0.10 lower than Wednesday’s prices at around $4.65, with contracts for December 2011 trading at around $4.65. Short-dated TSR 20 was trading down by about $0.07 at $4.36.
In India, the NMCE saw July deliveries fall by Rs 8 to around Rs212 ($4.72) per kilo
In China, the Shanghai Futures Exchange also saw prices fall by a fraction of a yuan, with July deliveries trading at around Yuan 33.9 ($5.27) per kilo.
Rubber in Tokyo Set for Worst Loss in Seven Weeks as Demand Concern Grows
June 24, 2011
Rubber headed for the worst weekly performance in seven weeks, as a slump in oil prices and concerns about global economic recovery cut the appeal of the commodity as an alternative to synthetic products used in tires.
The November-delivery contract dropped as much as 1.4 percent to 355.5 yen a kilogram ($4,417 a metric ton), the lowest level since May 6, before trading at 359.5 yen on the Tokyo Commodity Exchange at 10:40 a.m. The price has lost 5.3 percent this week, the largest drop since the week ended May 6 when it shed 7.3 percent.
Commodities fell the most in six weeks yesterday as the International Energy Agency announced plans to release emergency crude-oil supplies and U.S. jobless claims rose more than forecast. European Central Bank President Jean-Claude Trichet said the European debt crisis threatens to infect banks.
“Concerns about the U.S. and European economies were the largest drag on the market,” Hisaaki Tasaka, an analyst at ACE Koeki Co. in Tokyo, said by phone today. “Lower oil prices also eased speculation that prices of synthetic rubber may advance.”
Applications for jobless benefits rose more than forecast last week and consumer confidence in the U.S., the world’s second-largest economy, fell for the first time in five weeks. Risk signals for financial stability in the euro area are flashing “red,” as the crisis threatens banks, Trichet said.
Crude Slump
Crude climbed in New York as much as 1.5 percent today after sliding 4.6 percent yesterday. The International Energy Agency agreed to release 60 million barrels to buyers. Oil stockpiles among the 28 member countries of the IEA declined by 340,000 barrels a day during the first quarter of this year, the Agency said in its monthly Oil Market Report on June 16.
Rubber was also pressured on signs of increasing supplies from Thailand, the world’s largest producer and exporter, Tasaka said. Farmers boosted tree-tapping after a low-production period.
Output in Thailand is estimated to gain 6.8 percent to 3.26 million tons this year, according to the Office of Agricultural Economics. Output in India, the fourth-biggest producer, may jump 22 percent in four years as planters boost yields to keep pace with rising demand from tiremakers, according to the country’s state-run Rubber Board.
The physical price of Thai rubber dropped 3 percent to 146.10 baht ($4.77) a kilogram yesterday, the Rubber Research Institute of Thailand said on its website. “Overseas buyers have delayed purchases from Thailand and shifted to buy the commodity from other cheaper sources,” the group said.
In Shanghai, September-delivery rubber was little changed at 32,110 yuan ($4,962) a ton.
KOTTAYAM, JUNE 23:
Physical rubber prices continued to remain in a corrective phase on Thursday. The market made further losses mainly in the absence of buyers though there was no selling pressure from dealers or growers. Sharp declines in the international markets and a bearish outlook in the domestic futures were the guiding factors that kept the traders mostly on sidelines during the day. The transactions were low.
Though there has been an upswing consistently for the last few months in rubber prices, of late there is a set back to the rubber sector and some small units have shut down , according to Mr George Valy, President, Indian rubber Dealers Federation. The Chinese absence in the international market contributed considerably to the current decline. The tyre production is now at a slow pace and it has badly affected the automobile sector also. The market is now at a downward journey before it settles at a stage which should be acceptable to growers as well, Mr Valy observed
Sheet rubber weakened to Rs. 216.50 (217.50) a kg, according to traders. The grade moved down to Rs 217.00 (218.00) a kg both at Kottayam and Kochi, as reported by the Rubber Board.
In futures, the July series recovered marginally to Rs 213.90 (212.23), August to Rs 216.08 (215.32), September to Rs 215.94 (214.54) and December to Rs 217.90 (216.20) while the October series dropped to Rs 214.51 (214.74) and November to Rs 215.00 (218.20) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 (spot) declined to Rs 215.26 (221.73) a kg at Bangkok. The June futures nosedived to ¥ 377.9 (Rs 210.78) from ¥ 393.0 a kg during the day session and then slipped to ¥ 375.7 (Rs 209.54) in the night session on Tokyo Commodity Exchange.
Spot rubber rates (Rs/kg) were: RSS-4: 216.50 (217.50); RSS-5: 214.00 (215.00); Ungraded: 211.00 (213.00); ISNR 20: 213.00 (215.00) and Latex 60 per cent: 135.00 (137.00)
Soaring BR prices may trigger switch to NR – ICIS
June 23, 2011
Singapore — International analysts, ICIS are reporting that Asian tyre makers may switch away from synthetic rubber toward natural rubber (NR) if NR prices fall below $4/kg, based on the high cost of butadiene and polybutadiene rubber.
Spot BR prices increased by $175/tonne to around $4,300-4,550/tonne CFR (cost and freight) SE (southeast) Asia on 16 June, according to ICIS. Offers for July and August BR, meanwhile, were at $4,800-5,000/tonne CFR Asia, up by $200-300/tonne from the previous month, market sources said.
While BR and NR are not direct replacements, as suggested by ICIS, tyre makers do have some flexibility to substitute into or awaw from NR in their replacement tyres. Estimates of the potential for substitution vary, but average around 10 percent of global volume.
Tokyo NR prices sink to $4.46 (June 23)
June 23, 2011
On Tokyo’s Tocom Exchange, prices for the six-month contract moved down by yen 3 overnight, to close at yen 359 ($4.46) per kg on Thursday 23 June. Shorter-dated prices moved down, trading at around yen 370.
In Singapore, SGX said September RSS3 was around $0.10 lower than Wednesday’s prices at around $4.65, with contracts for December 2011 trading at around $4.65. Short-dated TSR 20 was trading down by about $0.07 at $4.36.
In India, the NMCE saw July deliveries fall by Rs 8 to around Rs212 ($4.72) per kilo
In China, the Shanghai Futures Exchange also saw prices fall by a fraction of a yuan, with July deliveries trading at around Yuan 33.9 ($5.27) per kilo.
Rubber in Tokyo Set for Worst Loss in Seven Weeks as Demand Concern Grows
June 24, 2011
Rubber headed for the worst weekly performance in seven weeks, as a slump in oil prices and concerns about global economic recovery cut the appeal of the commodity as an alternative to synthetic products used in tires.
The November-delivery contract dropped as much as 1.4 percent to 355.5 yen a kilogram ($4,417 a metric ton), the lowest level since May 6, before trading at 359.5 yen on the Tokyo Commodity Exchange at 10:40 a.m. The price has lost 5.3 percent this week, the largest drop since the week ended May 6 when it shed 7.3 percent.
Commodities fell the most in six weeks yesterday as the International Energy Agency announced plans to release emergency crude-oil supplies and U.S. jobless claims rose more than forecast. European Central Bank President Jean-Claude Trichet said the European debt crisis threatens to infect banks.
“Concerns about the U.S. and European economies were the largest drag on the market,” Hisaaki Tasaka, an analyst at ACE Koeki Co. in Tokyo, said by phone today. “Lower oil prices also eased speculation that prices of synthetic rubber may advance.”
Applications for jobless benefits rose more than forecast last week and consumer confidence in the U.S., the world’s second-largest economy, fell for the first time in five weeks. Risk signals for financial stability in the euro area are flashing “red,” as the crisis threatens banks, Trichet said.
Crude Slump
Crude climbed in New York as much as 1.5 percent today after sliding 4.6 percent yesterday. The International Energy Agency agreed to release 60 million barrels to buyers. Oil stockpiles among the 28 member countries of the IEA declined by 340,000 barrels a day during the first quarter of this year, the Agency said in its monthly Oil Market Report on June 16.
Rubber was also pressured on signs of increasing supplies from Thailand, the world’s largest producer and exporter, Tasaka said. Farmers boosted tree-tapping after a low-production period.
Output in Thailand is estimated to gain 6.8 percent to 3.26 million tons this year, according to the Office of Agricultural Economics. Output in India, the fourth-biggest producer, may jump 22 percent in four years as planters boost yields to keep pace with rising demand from tiremakers, according to the country’s state-run Rubber Board.
The physical price of Thai rubber dropped 3 percent to 146.10 baht ($4.77) a kilogram yesterday, the Rubber Research Institute of Thailand said on its website. “Overseas buyers have delayed purchases from Thailand and shifted to buy the commodity from other cheaper sources,” the group said.
In Shanghai, September-delivery rubber was little changed at 32,110 yuan ($4,962) a ton.
Thursday, June 23, 2011
Spot rubber dips on panic selling...June 22: NR prices sink further in Tokyo
Spot rubber dips on panic selling
KOTTAYAM, JUNE 22:
Domestic rubber prices lost heavily on Wednesday. In the spot, prices fell on panic selling by dealers, following sharp declines in domestic and international futures. According to sources, there was no visible improvement in arrivals as growers were still not prepared to sell their stocks since they expected better quotes during the ongoing low production season. Along with this, the absence of quantity buyers kept the market under pressure and it sought lower levels amidst comparatively dull volumes.
Sheet rubber declined to Rs 217.50 (222.50) a kg, as quoted by the traders. The grade surrendered to Rs 218.00 (222.50) a kg both at Kottayam and Kochi, according to the Rubber Board.
The July series weakened to Rs 212.65 (219.90), August to Rs 215.84 (221.77), September to Rs 215.15 (220.01) and October to Rs 214.50 (220.00) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 (spot) closed at Rs 221.73 (226.06) a kg at Bangkok. Its June futures dropped to ¥ 393.0 (Rs 219.79) from ¥ 400.7 a kg during the day session but then remained inactive in the night session on Tokyo Commodity Exchange.
The spot rubber rates (Rs/kg) were: RSS-4: 217.50 (222.50); RSS-5: 215 (220); Ungraded: 213 (218); ISNR 20: 215 (219) and Latex 60%: 137 (139).
June 22: NR prices sink further in Tokyo
June 22, 2011
Tokyo’s Tocom Exchange, prices for the six-month contract moved down by yen 16 overnight, to close at yen 362 ($4.51) per kg on Wednesday 22 June. Shorter-dated prices moved down sharply, trading at around yen 385.
In Singapore, SGX said September RSS3 was around $0.13 lower than Tuesday’s prices at around $4.75 on thin trading with contracts for January 2012 trading at around $4.53. Short-dated TSR 20 was trading down by about $0.15 at $4.43.
In India, the NMCE saw July deliveries unchanged at around Rs220 ($4.90) per kilo
In China, the Shanghai Futures Exchange also saw prices fall by half a yuan, with June deliveries trading at around Yuan 34.1 ($5.27) per kilo.
Tokyo Futures Weaker on Growth Concerns
June 22, 2011
Key Tokyo rubber futures eased on Wednesday (June 22) on an uncertain U.S. economic outlook and debt problems in the euro zone, which have fuelled concerns about demand, but losses were expected to be limited due to the lack of a strong selling factor.
FUNDAMENTALS
The benchmark rubber contract on the Tokyo Commodity Exchange for November delivery inched down 0.5 yen or 0.1 percent to 377.1 yen per kg as of 0007 GMT.
The most active Shanghai rubber contract for September delivery closed on Tuesday (June 21) at 33,310 yuan ($5,146.062) per tonne, compared with 33,290 yuan on Monday (June 20).
Oil fell in early Asia on Wednesday (June 22), after prices fell the day before on concerns about the euro zone.
The euro ran into profit-taking in Asia on Wednesday (June 22) after the Greek government won a vote of confidence in a widely expected outcome, but further losses may be limited as the market’s focus turns to the Federal Reserve.
MARKET NEWS
Greece’s embattled government survived a confidence vote on Wednesday (June 22) that was crucial to avoiding a sovereign default, as thousands of protesters chanted insults outside parliament.
Sales of previously owned U.S. homes hit a six-month low in May and supply rose, pointing to a housing market still struggling to regain its footing.
Germany’s Daimler warned of growing economic risks in emerging markets such as China that could cause the auto industry’s growth engine to sputter.
Natural rubber prices in India are likely to decline this week, tracking bearish global cues and reduced demand locally though falling supplies due to rains are seen restricting the losses, dealers said on Tuesday (June 21).
The Nikkei stock average gained for a third straight session, tracking an advance on Wall Street after Greece’s government on Wednesday (June 22) survived a confidence vote crucial to avoiding a sovereign default.
U.S. stocks posted gains for the fourth day on Tuesday (June 21) on growing hopes that Greece will avoid a debt default, adding momentum to the market’s recent rebound.
Crude oil prices fall again
June 22, 2011
Brent crude fell today, dragged down by the sell off in the spread to US crude and a warning about risks to Spain’s economy that added to concerns about the euro zone.
A sell off in the spread between Brent crude and US oil futures narrowed the London grade’s premium to below $US17 a barrel for the first time since June 9 as West Texas Intermediate staged a late session rally to end higher.
Crude prices had turned negative just before noon in New York trading.
The move picked up momentum after the International Monetary Fund warned that Spain faces considerable risks to economic recovery and must deepen and conclude reform work to allay market concerns.
“Crude futures fell back on the news of the IMF warning that the repair of Spain’s economy is incomplete and that risks are still considerable,” said Phil Flynn, analyst for PFGBest Research in Chicago.
“People are also concerned that the confidence vote on the Greek government later today won’t go as smoothly as earlier thought.”
Prices had risen in early trade, with gains pegged to the weakening in the dollar as investors grew more optimistic that Prime Minister George Papandreou’s cabinet would survive a confidence vote.
Brent August crude tumbled 74 cents to $US110.95 a barrel, off earlier highs of $US113.10 a barrel and marking the lowest settlement since May 23.
US crude for July delivery, which expired today, rose 14 cents to settle at $US93.40.
The more heavily traded August contract rose 54 cents to settle at $US94.17 a barrel, then turned negative after the release of US inventory data from the American Petroleum Institute.
“The market is obviously nervous and is trying to sort out macro economic issues like the confidence vote in Greece. Asset classes, across the board, are trying to sort their next direction,” said John Kilduff, partner at Again Capital LLC.
Late today, the Greek government survived the confidence vote. After that news, the US August crude contract fell to $US93.50, down 67 cents from Tuesday’s settlement, as traders took profits on the news.
The euro rose slightly on the Greek vote, but its gains faded with traders citing fear that next week, the Greek parliament may vote down a package of unpopular reforms.
In the day’s earlier trade, Brent crude reversed after failing to match Monday’s intra-day high and hitting resistance at the 50% Fibonacci retracement point of the price gains achieved between May and June.
US trading volumes were light, about 32% below the 30-day average just after the settlement at 493,000 lots. Brent traded a similar volume – 484,000 lots – about average for the 30-day period.
Analysts said that while crude oil prices remain high, the specter of weak demand and economic concerns have raised concerns among traders, with Brent crude falling for three straight sessions.
“This is one of those markets where there is not a lot supporting it,” said Peter Beutel, president of Cameron Hanover, trading consultants in New Canaan, Connecticut.
“At any given moment it can start dropping because there is no fundamental support, the demand numbers are not strong – these are the kinds of numbers you seen in a recession, not an expansion.”
Inventory data weighs
US crude for August had turned negative in late, post-settlement trade, following a smaller-than-expected draw in crude oil stocks last week, according to the API data.
Crude oil stocks fell by a small 81,000 barrels last week as refinery utilization rose, compared with analysts’ expectations of a 1.4 million barrel decline.
Inventories at the key US futures delivery hub of Cushing, Oklahoma, rose by 857,000 barrels on the week, API said.
Oil product stocks unexpectedly fell, with gasoline inventories off 1.5 million barrels even as refinery utilization rates climbed 2% percentage points to 86.5% of capacity.
Tokyo Futures in Range; Weak Shanghai, Supply Weigh
June 22, 2011
Key Tokyo rubber futures were little changed on Tuesday (June 21), caught in narrow ranges as a weak Shanghai rubber market and rising supplies weighed on sentiment while investors lacked incentives to sell actively.
The benchmark rubber contract on the Tokyo Commodity Exchange for November delivery settled at 377.6 yen per kg, nearly flat from Monday’s (June 20) settlement of 377.9 yen.
The most active Shanghai rubber contract for September delivery was also nearly flat, closing on Tuesday (June 21) at 33,310 yuan ($5,146.062) per tonne, compared with 33,290 yuan on Monday (June 20). It earlier fell as much as 1.6 percent on Tuesday (June 21).
Asian physical rubber prices were steady on Tuesday (June 21) despite the prospect of rising supply in major producing countries as firm futures prices on the Tokyo Commodity Exchange provided support, dealers said.
Tokyo stocks rose 1 percent for their biggest daily gain in three weeks on Tuesday (June 21), led by auto stocks climbing on bullish comments from a brokerage but volume was thin and most players were on the sidelines ahead of a Federal Reserve policy meeting.
Concerns about global economic outlook and sovereign debt crisis in the euro zone have recently dampened investor sentiment, putting a cap on TOCOM rubber prices.
High crude prices may derail growth in China and India, the two nations that have helped the global economy overcome the financial crisis, the International Energy Agency said.
ICE Brent crude futures rose more than $1 on Tuesday (June 21) as some investors tried to take advantage of the recent fall in crude prices.
The euro clung to small gains on Tuesday (June 21) as market players bet the euro zone will cobble together measures to prevent Greece from defaulting on its debt, though its advance could stall ahead of a confidence vote on the government in the Greek parliament.
Traders, packers promise to limit ‘doping' in rubber
KOCHI, JUNE 22:
The participation in National Multi Commodity Exchange's (NMCE) rubber futures has been growing and warehousing capacity has been increased to about 30,000 tonnes so that producers and suppliers are able to stock up to the maximum capacity. Although, on an average about 12,000 tonnes of rubber were stocked at any point of time last year, the NMCE said that the average would have been higher if the storage facilities were increased.
At a meeting organised by the NMCE in association with the Forward Markets Commission in Kochi, representatives of producers assured that they would not only improve the quality but also create greater awareness among the growers and traders. Traders and packers have pledged that all doping would be done within limit, although some unscrupulous traders might have used excess doping that can now be identified with the traceability programme that the warehousing corporation and the NMCE would introduce.
DOPING
Doping is an instance where a stockist uses powder and solutions to mark his identity and the quality of the rubber on 50-kg weight of rubber sheets for future identification at the warehouses, Mr N. Radhakrishnan, Advisor to the Cochin Rubber Merchants Association, said. “There are some unscrupulous traders who use half to one kg of doping in order to increase the weight of his stocks. If at the time of delivery, the weight is found to be different, it is the warehouses and that NMCE who would be held accountable.”
The meeting was called in order address the issues of stakeholders where prominent members and senior officials of the Rubber Board, NMCE, producers, cooperative society, central warehousing corporation, rubber user industry, traders and brokers were present.
Dr S. Mohan Chandran Nair, Director of Rubber Board, stressed the need on quality and packing improvement in the case of rubber. He also dealt on how doping can be reduced. It was decided that CWC would be given sample rubber sheets which would show acceptable range of doping and those with excessive doping would be rejected.
It was also decided that awareness programmes would be conducted on doping aspect in which the NMCE and the CWC would also participate along with Rubber Board. The CWC would maintain the details of the original depositor so that excess doping suppliers could be identified and traced at any stage.
PEPPER DELIVERY CENTRE
Dr Charles Kithu, Director of Spices Board, offered to provide excellent grading and processing facility at Vandanmedu for both black pepper and cardamom. Mr Anil Mishra, Managing Director, NMCE, welcomed the move and asked members present whether Vandanmedu should be declared as additional delivery centre for black pepper.
Over and above Kochi, the NMCE said that it would declare Vandanmedu as an additional delivery centre, which would be in the interest of the farmers. The CWC has acquired good go-downs for storage at Vandanmedu and they are committed to give excellent service to both producers and users.
Warehouse receipt funding issue was also discussed with the bankers present and they have agreed to look at the increasing opportunity of almost risk free advances against warehouse receipts when it is accompanied with forwards sales note on the NMCE because the banks would have risk free lending and would get paid directly by the NMCE on production of warehouse receipts.
MRF declares lockout at Kottayam plant
Story Dated: Wednesday, June 22, 2011 15:36 hrs IST
Chennai: Leading tyre manufacturer MRF has declared a lock out at their Kottayam plant following labour unrest. In a filing to the Bombay Stock Exchange, MRF said it had declared the lock out with effect from 5 a.m., Wednesday on account of labour unrest.
Union sources said the lockout at the plant in Vadathoor was a fallout of a dispute between an employee and a supervisor over alleged unauthorised leave. The employee was not allowed to join duty on Saturday and supporting him other workers staged a 'walkout', a union office-bearer said.
The plant had not been operating for the last four days and the loss was estimated about Rs 22 crore, he said. The Kottayam plant employs about 1,350 personnel in all three shifts and manufactures tyres, tubes, he added.
MRF Tyres has seven manufacturing facilities in South India. It exports tyres and conveyor belts to over 65 nations, including US, Europe, Middle East, Japan.
KOTTAYAM, JUNE 22:
Domestic rubber prices lost heavily on Wednesday. In the spot, prices fell on panic selling by dealers, following sharp declines in domestic and international futures. According to sources, there was no visible improvement in arrivals as growers were still not prepared to sell their stocks since they expected better quotes during the ongoing low production season. Along with this, the absence of quantity buyers kept the market under pressure and it sought lower levels amidst comparatively dull volumes.
Sheet rubber declined to Rs 217.50 (222.50) a kg, as quoted by the traders. The grade surrendered to Rs 218.00 (222.50) a kg both at Kottayam and Kochi, according to the Rubber Board.
The July series weakened to Rs 212.65 (219.90), August to Rs 215.84 (221.77), September to Rs 215.15 (220.01) and October to Rs 214.50 (220.00) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 (spot) closed at Rs 221.73 (226.06) a kg at Bangkok. Its June futures dropped to ¥ 393.0 (Rs 219.79) from ¥ 400.7 a kg during the day session but then remained inactive in the night session on Tokyo Commodity Exchange.
The spot rubber rates (Rs/kg) were: RSS-4: 217.50 (222.50); RSS-5: 215 (220); Ungraded: 213 (218); ISNR 20: 215 (219) and Latex 60%: 137 (139).
June 22: NR prices sink further in Tokyo
June 22, 2011
Tokyo’s Tocom Exchange, prices for the six-month contract moved down by yen 16 overnight, to close at yen 362 ($4.51) per kg on Wednesday 22 June. Shorter-dated prices moved down sharply, trading at around yen 385.
In Singapore, SGX said September RSS3 was around $0.13 lower than Tuesday’s prices at around $4.75 on thin trading with contracts for January 2012 trading at around $4.53. Short-dated TSR 20 was trading down by about $0.15 at $4.43.
In India, the NMCE saw July deliveries unchanged at around Rs220 ($4.90) per kilo
In China, the Shanghai Futures Exchange also saw prices fall by half a yuan, with June deliveries trading at around Yuan 34.1 ($5.27) per kilo.
Tokyo Futures Weaker on Growth Concerns
June 22, 2011
Key Tokyo rubber futures eased on Wednesday (June 22) on an uncertain U.S. economic outlook and debt problems in the euro zone, which have fuelled concerns about demand, but losses were expected to be limited due to the lack of a strong selling factor.
FUNDAMENTALS
The benchmark rubber contract on the Tokyo Commodity Exchange for November delivery inched down 0.5 yen or 0.1 percent to 377.1 yen per kg as of 0007 GMT.
The most active Shanghai rubber contract for September delivery closed on Tuesday (June 21) at 33,310 yuan ($5,146.062) per tonne, compared with 33,290 yuan on Monday (June 20).
Oil fell in early Asia on Wednesday (June 22), after prices fell the day before on concerns about the euro zone.
The euro ran into profit-taking in Asia on Wednesday (June 22) after the Greek government won a vote of confidence in a widely expected outcome, but further losses may be limited as the market’s focus turns to the Federal Reserve.
MARKET NEWS
Greece’s embattled government survived a confidence vote on Wednesday (June 22) that was crucial to avoiding a sovereign default, as thousands of protesters chanted insults outside parliament.
Sales of previously owned U.S. homes hit a six-month low in May and supply rose, pointing to a housing market still struggling to regain its footing.
Germany’s Daimler warned of growing economic risks in emerging markets such as China that could cause the auto industry’s growth engine to sputter.
Natural rubber prices in India are likely to decline this week, tracking bearish global cues and reduced demand locally though falling supplies due to rains are seen restricting the losses, dealers said on Tuesday (June 21).
The Nikkei stock average gained for a third straight session, tracking an advance on Wall Street after Greece’s government on Wednesday (June 22) survived a confidence vote crucial to avoiding a sovereign default.
U.S. stocks posted gains for the fourth day on Tuesday (June 21) on growing hopes that Greece will avoid a debt default, adding momentum to the market’s recent rebound.
Crude oil prices fall again
June 22, 2011
Brent crude fell today, dragged down by the sell off in the spread to US crude and a warning about risks to Spain’s economy that added to concerns about the euro zone.
A sell off in the spread between Brent crude and US oil futures narrowed the London grade’s premium to below $US17 a barrel for the first time since June 9 as West Texas Intermediate staged a late session rally to end higher.
Crude prices had turned negative just before noon in New York trading.
The move picked up momentum after the International Monetary Fund warned that Spain faces considerable risks to economic recovery and must deepen and conclude reform work to allay market concerns.
“Crude futures fell back on the news of the IMF warning that the repair of Spain’s economy is incomplete and that risks are still considerable,” said Phil Flynn, analyst for PFGBest Research in Chicago.
“People are also concerned that the confidence vote on the Greek government later today won’t go as smoothly as earlier thought.”
Prices had risen in early trade, with gains pegged to the weakening in the dollar as investors grew more optimistic that Prime Minister George Papandreou’s cabinet would survive a confidence vote.
Brent August crude tumbled 74 cents to $US110.95 a barrel, off earlier highs of $US113.10 a barrel and marking the lowest settlement since May 23.
US crude for July delivery, which expired today, rose 14 cents to settle at $US93.40.
The more heavily traded August contract rose 54 cents to settle at $US94.17 a barrel, then turned negative after the release of US inventory data from the American Petroleum Institute.
“The market is obviously nervous and is trying to sort out macro economic issues like the confidence vote in Greece. Asset classes, across the board, are trying to sort their next direction,” said John Kilduff, partner at Again Capital LLC.
Late today, the Greek government survived the confidence vote. After that news, the US August crude contract fell to $US93.50, down 67 cents from Tuesday’s settlement, as traders took profits on the news.
The euro rose slightly on the Greek vote, but its gains faded with traders citing fear that next week, the Greek parliament may vote down a package of unpopular reforms.
In the day’s earlier trade, Brent crude reversed after failing to match Monday’s intra-day high and hitting resistance at the 50% Fibonacci retracement point of the price gains achieved between May and June.
US trading volumes were light, about 32% below the 30-day average just after the settlement at 493,000 lots. Brent traded a similar volume – 484,000 lots – about average for the 30-day period.
Analysts said that while crude oil prices remain high, the specter of weak demand and economic concerns have raised concerns among traders, with Brent crude falling for three straight sessions.
“This is one of those markets where there is not a lot supporting it,” said Peter Beutel, president of Cameron Hanover, trading consultants in New Canaan, Connecticut.
“At any given moment it can start dropping because there is no fundamental support, the demand numbers are not strong – these are the kinds of numbers you seen in a recession, not an expansion.”
Inventory data weighs
US crude for August had turned negative in late, post-settlement trade, following a smaller-than-expected draw in crude oil stocks last week, according to the API data.
Crude oil stocks fell by a small 81,000 barrels last week as refinery utilization rose, compared with analysts’ expectations of a 1.4 million barrel decline.
Inventories at the key US futures delivery hub of Cushing, Oklahoma, rose by 857,000 barrels on the week, API said.
Oil product stocks unexpectedly fell, with gasoline inventories off 1.5 million barrels even as refinery utilization rates climbed 2% percentage points to 86.5% of capacity.
Tokyo Futures in Range; Weak Shanghai, Supply Weigh
June 22, 2011
Key Tokyo rubber futures were little changed on Tuesday (June 21), caught in narrow ranges as a weak Shanghai rubber market and rising supplies weighed on sentiment while investors lacked incentives to sell actively.
The benchmark rubber contract on the Tokyo Commodity Exchange for November delivery settled at 377.6 yen per kg, nearly flat from Monday’s (June 20) settlement of 377.9 yen.
The most active Shanghai rubber contract for September delivery was also nearly flat, closing on Tuesday (June 21) at 33,310 yuan ($5,146.062) per tonne, compared with 33,290 yuan on Monday (June 20). It earlier fell as much as 1.6 percent on Tuesday (June 21).
Asian physical rubber prices were steady on Tuesday (June 21) despite the prospect of rising supply in major producing countries as firm futures prices on the Tokyo Commodity Exchange provided support, dealers said.
Tokyo stocks rose 1 percent for their biggest daily gain in three weeks on Tuesday (June 21), led by auto stocks climbing on bullish comments from a brokerage but volume was thin and most players were on the sidelines ahead of a Federal Reserve policy meeting.
Concerns about global economic outlook and sovereign debt crisis in the euro zone have recently dampened investor sentiment, putting a cap on TOCOM rubber prices.
High crude prices may derail growth in China and India, the two nations that have helped the global economy overcome the financial crisis, the International Energy Agency said.
ICE Brent crude futures rose more than $1 on Tuesday (June 21) as some investors tried to take advantage of the recent fall in crude prices.
The euro clung to small gains on Tuesday (June 21) as market players bet the euro zone will cobble together measures to prevent Greece from defaulting on its debt, though its advance could stall ahead of a confidence vote on the government in the Greek parliament.
Traders, packers promise to limit ‘doping' in rubber
KOCHI, JUNE 22:
The participation in National Multi Commodity Exchange's (NMCE) rubber futures has been growing and warehousing capacity has been increased to about 30,000 tonnes so that producers and suppliers are able to stock up to the maximum capacity. Although, on an average about 12,000 tonnes of rubber were stocked at any point of time last year, the NMCE said that the average would have been higher if the storage facilities were increased.
At a meeting organised by the NMCE in association with the Forward Markets Commission in Kochi, representatives of producers assured that they would not only improve the quality but also create greater awareness among the growers and traders. Traders and packers have pledged that all doping would be done within limit, although some unscrupulous traders might have used excess doping that can now be identified with the traceability programme that the warehousing corporation and the NMCE would introduce.
DOPING
Doping is an instance where a stockist uses powder and solutions to mark his identity and the quality of the rubber on 50-kg weight of rubber sheets for future identification at the warehouses, Mr N. Radhakrishnan, Advisor to the Cochin Rubber Merchants Association, said. “There are some unscrupulous traders who use half to one kg of doping in order to increase the weight of his stocks. If at the time of delivery, the weight is found to be different, it is the warehouses and that NMCE who would be held accountable.”
The meeting was called in order address the issues of stakeholders where prominent members and senior officials of the Rubber Board, NMCE, producers, cooperative society, central warehousing corporation, rubber user industry, traders and brokers were present.
Dr S. Mohan Chandran Nair, Director of Rubber Board, stressed the need on quality and packing improvement in the case of rubber. He also dealt on how doping can be reduced. It was decided that CWC would be given sample rubber sheets which would show acceptable range of doping and those with excessive doping would be rejected.
It was also decided that awareness programmes would be conducted on doping aspect in which the NMCE and the CWC would also participate along with Rubber Board. The CWC would maintain the details of the original depositor so that excess doping suppliers could be identified and traced at any stage.
PEPPER DELIVERY CENTRE
Dr Charles Kithu, Director of Spices Board, offered to provide excellent grading and processing facility at Vandanmedu for both black pepper and cardamom. Mr Anil Mishra, Managing Director, NMCE, welcomed the move and asked members present whether Vandanmedu should be declared as additional delivery centre for black pepper.
Over and above Kochi, the NMCE said that it would declare Vandanmedu as an additional delivery centre, which would be in the interest of the farmers. The CWC has acquired good go-downs for storage at Vandanmedu and they are committed to give excellent service to both producers and users.
Warehouse receipt funding issue was also discussed with the bankers present and they have agreed to look at the increasing opportunity of almost risk free advances against warehouse receipts when it is accompanied with forwards sales note on the NMCE because the banks would have risk free lending and would get paid directly by the NMCE on production of warehouse receipts.
MRF declares lockout at Kottayam plant
Story Dated: Wednesday, June 22, 2011 15:36 hrs IST
Chennai: Leading tyre manufacturer MRF has declared a lock out at their Kottayam plant following labour unrest. In a filing to the Bombay Stock Exchange, MRF said it had declared the lock out with effect from 5 a.m., Wednesday on account of labour unrest.
Union sources said the lockout at the plant in Vadathoor was a fallout of a dispute between an employee and a supervisor over alleged unauthorised leave. The employee was not allowed to join duty on Saturday and supporting him other workers staged a 'walkout', a union office-bearer said.
The plant had not been operating for the last four days and the loss was estimated about Rs 22 crore, he said. The Kottayam plant employs about 1,350 personnel in all three shifts and manufactures tyres, tubes, he added.
MRF Tyres has seven manufacturing facilities in South India. It exports tyres and conveyor belts to over 65 nations, including US, Europe, Middle East, Japan.
Tuesday, June 21, 2011
Rubber falls as major buyers keep away
Rubber falls as major buyers keep away
KOTTAYAM, JUNE 20:
Physical rubber prices slipped on Monday. According to observers, the market fell further though it was expected to remain firm during the season on supply concerns as major consuming industries were totally inactive. The trend was partially mixed. Meanwhile in the international scene, the key Tokyo rubber futures slipped on low demand due to uncertainty over the economic outlook of the US but the losses were limited on short supplies.
Sheet rubber declined to Rs 222.50 (224.00) a kg according to traders. The grade dropped to Rs 223.00 (225.00) a kg both at Kottayam and Kochi as reported by the Rubber Board.
In futures, the July series closed at Rs 222.10 (222.75), August at Rs 224.19 (224.57), September at Rs 222.45 (222.40), October at Rs 221.94 (221.75), November at Rs 221.50 (222.25) and December at Rs 223.40 (226.60) per kg for RSS 4 on National Multi Commodity Exchange (NMCE). RSS 3 (spot) weakened to Rs 227.72 (229.72) a kg at Bangkok. The June futures slipped to Rs 405.0 (Rs 226.99) from Rs 406.0 per kg during the day session but then finished unchanged at Rs 405 in the night session on the Tokyo Commodity Exchange (TOCOM).
The spot rubber rates in Rs per kg were: RSS-4: 222.50 (224.00), RSS-5: 220.00 (222.00),
Ungraded: 218.00 (218.00), ISNR 20: 221.00 (222.00), and Latex 60 per cent: 139.00 (140.00)
Tokyo Futures Fall on Growth Concerns
June 20, 2011
Key Tokyo rubber futures fell about 1 percent on Monday (June 20) on demand concerns due to uncertainty over the U.S. economic outlook, though supply worries were likely to limit losses.
FUNDAMENTALS
The benchmark rubber contract on the Tokyo Commodity Exchange for November delivery fell 3.5 yen, or 0.9 percent, to 376.3 yen per kg as of 0010 GMT.
The most active Shanghai rubber contract for September delivery rose 295 yuan to close on Friday (June 17) at 33,405 yuan ($5,158.734) per tonne.
TOCOM futures prices are expected to be supported this week by limited supply on heavy rain in Thailand, the world’s biggest producer, disrupting tapping and cutting supply.
U.S. crude futures in Asia on Monday (June 20) slipped from earlier gains after falling to a four-month low below $92 per barrel late last week on an easing in worries about demand.
The euro clung to most of the gains made late last week, underpinned by hopes for some progress on Greece’s debt crisis, but the single currency remained vulnerable to any turn of events as European officials meet to hammer out a deal.
MARKET NEWS
U.S. consumer sentiment worsened this month on renewed concerns about the outlook for the economy and as gloom about job and income prospects persisted, data showed on Friday (June 17).
Japan’s exports fell 10.3 percent in May from a year earlier, with the pace of decline slowing, Ministry of Finance data showed on Monday (June 20), as companies mend supply chains and resume factory output after the March earthquake and tsunami, but the trade balance logged a deficit for the second straight month due to a jump in imports.
A few cargoes of tyre grade rubber changed hands for July and August shipment at around $4 a kg, and main consumer China began showing some interest after a long absence although no business was reported, dealers said on Friday (June 17).
Rubber inventories in warehouses monitored by the Shanghai Futures Exchange rose 6.5 percent last week, the exchange said on Friday (June 17).
Hyundai Motor Co plans to boost its European new-car sales to 500,000 by 2013, up nearly 40 percent from 358,284 in 2010, the Korean automaker told Automotive News Europe.
Japan’s benchmark Nikkei stock average opened up 0.34 percent at 9,383.24 on Monday (June 20).
The Dow and S&P 500 rose on Friday (June 17) after France and Germany outlined an agreement to aid debt-burdened Greece, but analysts said a recent bearish trend may persist.
(Reuters, June 20, 2011)
China Car Market To Start Recovering in 6-12 Months – GM
June 20, 2011
The sharp slowdown in China’s auto market, the world’s biggest, is temporary and recovery will start in the next 6 to 12 months, the China chief of General Motors said on Friday (June 17).
The country’s overall car sales dipped 0.1 percent in May from a year earlier, its first decline in more than two years, after the government unwound all its policy incentives that saw sales surge by a third in 2010 and more than half in 2009.
“We think that it (slowdown) is only temporary. We think it’ll recover in the next 6-12 months,” GM’s China head Kevin Wale told Reuters in an interview.
“We tend to focus on trend line growth, which we think is still going to be solid. The economic fundamentals are still strong.”
Industry observers are divided over the market outlook for the rest of the year. Optimists still expect the market to finish the year on a positive note, but pessimists predict a decline of as much as 10 percent.
“Our objective is to grow 10-15 percent and we want to outperform the market. But realistically it’s a tough market and you’re not going to make quantum leaps. You’ve just got to make sure you keep moving a bit more than the market moves,” Wale said.
The Detroit automaker’s China sales in May fell 2.7 percent from a year earlier, its second consecutive monthly decline.
Wale said in April that GM planned to more than double its sales in China to around 5 million units by 2015 after introducing some 60 new and upgraded models over the coming five years.
Speaking on electric vehicles (EVs), which automakers see as the next area of growth, Wale said in the interview GM hoped to produce all its EVs, including its poster car Volt, in China although he did not give a time frame.
“At some stage we’d love to produce all our electric vehicles here. It’s the world’s largest market,” he said.
“We think it’s really important we develop local supply capability and technology. We’re focused on developing the supply capability in China so we can all grow at the same pace.”
Wale reiterated the company’s plans to introduce the Chevrolet Volt in the fourth quarter of this year.
China is aiming to have half a million EVs on the roads by 2015 although sales have totalled just 7,000 so far.
“One would probably think the numbers are a bit ambitious at this stage. There’s still a lot of development work that needs to be done on electric vehicles in terms of total supply chain, infrastructure and vehicles.”
(Reuters, June 17, 2011)
KOTTAYAM, JUNE 20:
Physical rubber prices slipped on Monday. According to observers, the market fell further though it was expected to remain firm during the season on supply concerns as major consuming industries were totally inactive. The trend was partially mixed. Meanwhile in the international scene, the key Tokyo rubber futures slipped on low demand due to uncertainty over the economic outlook of the US but the losses were limited on short supplies.
Sheet rubber declined to Rs 222.50 (224.00) a kg according to traders. The grade dropped to Rs 223.00 (225.00) a kg both at Kottayam and Kochi as reported by the Rubber Board.
In futures, the July series closed at Rs 222.10 (222.75), August at Rs 224.19 (224.57), September at Rs 222.45 (222.40), October at Rs 221.94 (221.75), November at Rs 221.50 (222.25) and December at Rs 223.40 (226.60) per kg for RSS 4 on National Multi Commodity Exchange (NMCE). RSS 3 (spot) weakened to Rs 227.72 (229.72) a kg at Bangkok. The June futures slipped to Rs 405.0 (Rs 226.99) from Rs 406.0 per kg during the day session but then finished unchanged at Rs 405 in the night session on the Tokyo Commodity Exchange (TOCOM).
The spot rubber rates in Rs per kg were: RSS-4: 222.50 (224.00), RSS-5: 220.00 (222.00),
Ungraded: 218.00 (218.00), ISNR 20: 221.00 (222.00), and Latex 60 per cent: 139.00 (140.00)
Tokyo Futures Fall on Growth Concerns
June 20, 2011
Key Tokyo rubber futures fell about 1 percent on Monday (June 20) on demand concerns due to uncertainty over the U.S. economic outlook, though supply worries were likely to limit losses.
FUNDAMENTALS
The benchmark rubber contract on the Tokyo Commodity Exchange for November delivery fell 3.5 yen, or 0.9 percent, to 376.3 yen per kg as of 0010 GMT.
The most active Shanghai rubber contract for September delivery rose 295 yuan to close on Friday (June 17) at 33,405 yuan ($5,158.734) per tonne.
TOCOM futures prices are expected to be supported this week by limited supply on heavy rain in Thailand, the world’s biggest producer, disrupting tapping and cutting supply.
U.S. crude futures in Asia on Monday (June 20) slipped from earlier gains after falling to a four-month low below $92 per barrel late last week on an easing in worries about demand.
The euro clung to most of the gains made late last week, underpinned by hopes for some progress on Greece’s debt crisis, but the single currency remained vulnerable to any turn of events as European officials meet to hammer out a deal.
MARKET NEWS
U.S. consumer sentiment worsened this month on renewed concerns about the outlook for the economy and as gloom about job and income prospects persisted, data showed on Friday (June 17).
Japan’s exports fell 10.3 percent in May from a year earlier, with the pace of decline slowing, Ministry of Finance data showed on Monday (June 20), as companies mend supply chains and resume factory output after the March earthquake and tsunami, but the trade balance logged a deficit for the second straight month due to a jump in imports.
A few cargoes of tyre grade rubber changed hands for July and August shipment at around $4 a kg, and main consumer China began showing some interest after a long absence although no business was reported, dealers said on Friday (June 17).
Rubber inventories in warehouses monitored by the Shanghai Futures Exchange rose 6.5 percent last week, the exchange said on Friday (June 17).
Hyundai Motor Co plans to boost its European new-car sales to 500,000 by 2013, up nearly 40 percent from 358,284 in 2010, the Korean automaker told Automotive News Europe.
Japan’s benchmark Nikkei stock average opened up 0.34 percent at 9,383.24 on Monday (June 20).
The Dow and S&P 500 rose on Friday (June 17) after France and Germany outlined an agreement to aid debt-burdened Greece, but analysts said a recent bearish trend may persist.
(Reuters, June 20, 2011)
China Car Market To Start Recovering in 6-12 Months – GM
June 20, 2011
The sharp slowdown in China’s auto market, the world’s biggest, is temporary and recovery will start in the next 6 to 12 months, the China chief of General Motors said on Friday (June 17).
The country’s overall car sales dipped 0.1 percent in May from a year earlier, its first decline in more than two years, after the government unwound all its policy incentives that saw sales surge by a third in 2010 and more than half in 2009.
“We think that it (slowdown) is only temporary. We think it’ll recover in the next 6-12 months,” GM’s China head Kevin Wale told Reuters in an interview.
“We tend to focus on trend line growth, which we think is still going to be solid. The economic fundamentals are still strong.”
Industry observers are divided over the market outlook for the rest of the year. Optimists still expect the market to finish the year on a positive note, but pessimists predict a decline of as much as 10 percent.
“Our objective is to grow 10-15 percent and we want to outperform the market. But realistically it’s a tough market and you’re not going to make quantum leaps. You’ve just got to make sure you keep moving a bit more than the market moves,” Wale said.
The Detroit automaker’s China sales in May fell 2.7 percent from a year earlier, its second consecutive monthly decline.
Wale said in April that GM planned to more than double its sales in China to around 5 million units by 2015 after introducing some 60 new and upgraded models over the coming five years.
Speaking on electric vehicles (EVs), which automakers see as the next area of growth, Wale said in the interview GM hoped to produce all its EVs, including its poster car Volt, in China although he did not give a time frame.
“At some stage we’d love to produce all our electric vehicles here. It’s the world’s largest market,” he said.
“We think it’s really important we develop local supply capability and technology. We’re focused on developing the supply capability in China so we can all grow at the same pace.”
Wale reiterated the company’s plans to introduce the Chevrolet Volt in the fourth quarter of this year.
China is aiming to have half a million EVs on the roads by 2015 although sales have totalled just 7,000 so far.
“One would probably think the numbers are a bit ambitious at this stage. There’s still a lot of development work that needs to be done on electric vehicles in terms of total supply chain, infrastructure and vehicles.”
(Reuters, June 17, 2011)
Saturday, June 18, 2011
Spot rubber turns weak on buyer resistance
Rubber market on June 17: Spot rubber turns weak on buyer resistance
June 17, 2011
KOTTAYAM, JUNE 17:
Rubber prices turned weak on Friday. On the spot, the market slipped on buyer resistance following declines in domestic and international futures. There was some visible selling pressure from dealers though the market is reported to be suffering from short supplies following monsoon rain.
Sheet rubber surrendered to Rs 226 (228) a kg, according to traders. The grade dropped to Rs 227 (228) a kg both at Kottayam and Kochi, according to the Rubber Board.
RSS 4 July series declined to Rs 226 (230.25), August to Rs 227.63 (232.16), September to Rs 226.51 (230.26), October to Rs 226 (229.15) and November to Rs 226.02 (229.30) a kg while the December series improved marginally to Rs 227.25 (227) on the National Multi Commodity Exchange.
RSS 3 (spot) closed weak at Rs 229.72 (231.14) a kg at Bangkok. June futures declined to ¥406 (Rs 226.89) from ¥412.5 a kg on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 226 (228); RSS-5: 224 (226); ungraded: 219 (222); ISNR 20: 224 (224.50) and latex 60 per cent: 141 (143).
June 17, 2011
KOTTAYAM, JUNE 17:
Rubber prices turned weak on Friday. On the spot, the market slipped on buyer resistance following declines in domestic and international futures. There was some visible selling pressure from dealers though the market is reported to be suffering from short supplies following monsoon rain.
Sheet rubber surrendered to Rs 226 (228) a kg, according to traders. The grade dropped to Rs 227 (228) a kg both at Kottayam and Kochi, according to the Rubber Board.
RSS 4 July series declined to Rs 226 (230.25), August to Rs 227.63 (232.16), September to Rs 226.51 (230.26), October to Rs 226 (229.15) and November to Rs 226.02 (229.30) a kg while the December series improved marginally to Rs 227.25 (227) on the National Multi Commodity Exchange.
RSS 3 (spot) closed weak at Rs 229.72 (231.14) a kg at Bangkok. June futures declined to ¥406 (Rs 226.89) from ¥412.5 a kg on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 226 (228); RSS-5: 224 (226); ungraded: 219 (222); ISNR 20: 224 (224.50) and latex 60 per cent: 141 (143).
Friday, June 17, 2011
Tokyo Futures Lower, Tracking Oil And Stocks
Tokyo Futures Lower, Tracking Oil And Stocks
June 16, 2011
Tokyo rubber futures inched lower on Thursday (June 16) as pessimism over prospects for the U.S. economy and escalating debt woes in Greece weighed on the global stock and commodities markets, though the yen’s fall against the dollar lent support.
FUNDAMENTALS
The key Tokyo Commodity Exchange rubber contract for November delivery was down 5.0 yen or 1.3 percent at 381.2 yen per kg as of 0055 GMT.
The most active Shanghai rubber contract for September delivery rose 730 yuan to finish at 33,500 yuan ($5,170) per tonne on Wednesday (June 15).
The dollar held at three-week highs against a basket of major currencies in Asia on Thursday (June 16), having staged its biggest rally in 10 months on a wave of short-covering as concerns over Greece’s debt crisis hammered the euro.
Oil slid more than 4 percent on Wednesday (June 15) as signs of further economic weakness fed demand worries and a rising dollar weighed, triggering technical sell stops and sending U.S. crude to its lowest since February.
MARKET NEWS
Sentiment among Japanese manufacturers rose in June for the second straight month and is seen improving further in the coming quarter, a Reuters poll showed, underlining prospects for the economy’s recovery from the March 11 earthquake.
Discussion of plans for the Renault-Nissan alliance to take a majority stake in Russia’s AvtoVAZ is likely to take a few more months, a source familiar with the matter said.
Japan’s Nikkei business daily reported on Thursday (June 16) that Nissan Motor Co was in the final stages of talks to take a stake of about 25 percent in AvtoVAZ for up to $1 billion. Partner Renault SA already owns 25 percent of AvtoVAZ, Russia’s biggest car maker.
Prospects for a step-up in U.S. economic growth in the second half of the year are becoming clearer.
No.2 U.S. automaker Ford Motor Co expects its profit for the rest of the year to ease off from the 13-year high it reported for the first quarter, pinched by higher commodity costs, an executive said.
Tokyo stocks on Thursday (June 16) tracked Wall Street lower after it tumbled on escalating Greek debt woes and as U.S. data showed the world’s No.1 economy is facing a troubling mix of higher prices and weak growth, pointing to further losses.
Chinese industrial output in May beat market expectations with a 13.3 percent rise from a year before, compared with April’s 13.4 percent expansion, according to the National Bureau of Statistics (NBS).
(Reuters, June 16, 2011)
Rubber market on June 15: Mixed trend in rubber
June 15, 2011
KOTTAYAM, JUNE 15:
Spot rubber saw a mixed trend on Wednesday. The undercurrent was firm as RSS 5 and ungraded rubber improved following comparatively better demand.
Weather variations seemed to have confused traders who decided to wait for clarity after the expiry of the June futures on the National Multi Commodity Exchange.
According to traders, sheet rubber finished flat at Rs 227.50 a kg amidst low volumes. The grade improved to Rs 227.50 (227) a kg both at Kottayam and Kochi, according to the Rubber Board.
The June series expired at Rs 229.25 (227.39) while the July series weakened to Rs 230.70 (231.93), August to Rs 232.43 (234.06), September to Rs 231.45 (232.58), October to Rs 229.01 (231.28) and November to Rs 229.80 (230.25) a kg for RSS 4 on NMCE.
RSS 3 (spot) slipped to Rs 231.65 (232.20) a kg at Bangkok. The June futures for the grade recovered to ¥414 (Rs 229.58) from ¥411.9 a kg during the day session and then to ¥416 (Rs 230.68) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 227.50 (227.50); RSS-5: 226 (225); ungraded: 222 (222); ISNR 20: 224 (223) and latex 60 per cent: 143 (143).
‘Kerala rubber convention can help showcase technology’
June 15, 2011
KOCHI, JUNE 15:
The Confederation of Indian Industry and the Rubber Board organised a one-day conference in Kottayam to create a platform showcasing developing technologies and ideas related to rubber processing. The theme of the conference, held under the banner of Kerala Rubber Convention 2011, was “Sustainable rubber manufacturing and processing.”
Inaugurating the session, Ms Sheela Thomas, Chairperson of Rubber Board, Government of India, said, “Kerala Rubber Convention will create a platform for showcasing technology, ideas and solutions and help rubber planters and micro, small and medium industries as well as regional and national players to attain economic sustainability in their operations.” The conference was also expected to enhance technological interventions and highlight Kerala’s potential as a promising investment destination.
India is the fourth-largest producer and third-largest consumer of natural rubber in the world. Over one million people are directly involved in farming of rubber, while another six million people are indirectly associated with this business. There are around 4,500 manufacturing units dependent on rubber.
STATE’S ECONOMY BENEFITS
Rubber is seen as key to the development of Kerala. The recent rally in rubber prices is estimated to have contributed significantly to the 10 per-cent-growth registered by the State’s economy. Close to 92 per cent of the nine lakh tonnes of rubber produced in India comes from Kerala.
“Today’s session will enhance technological intervention and highlight Kerala’s potential as a promising investment destination. This will also provide a platform for business meetings and knowing more about financing options,” Mr K.T. Thomas, Chairman of Kerala Rubber Convention 2011 and Director of Paragon Polymer Products, said.
June 16, 2011
Tokyo rubber futures inched lower on Thursday (June 16) as pessimism over prospects for the U.S. economy and escalating debt woes in Greece weighed on the global stock and commodities markets, though the yen’s fall against the dollar lent support.
FUNDAMENTALS
The key Tokyo Commodity Exchange rubber contract for November delivery was down 5.0 yen or 1.3 percent at 381.2 yen per kg as of 0055 GMT.
The most active Shanghai rubber contract for September delivery rose 730 yuan to finish at 33,500 yuan ($5,170) per tonne on Wednesday (June 15).
The dollar held at three-week highs against a basket of major currencies in Asia on Thursday (June 16), having staged its biggest rally in 10 months on a wave of short-covering as concerns over Greece’s debt crisis hammered the euro.
Oil slid more than 4 percent on Wednesday (June 15) as signs of further economic weakness fed demand worries and a rising dollar weighed, triggering technical sell stops and sending U.S. crude to its lowest since February.
MARKET NEWS
Sentiment among Japanese manufacturers rose in June for the second straight month and is seen improving further in the coming quarter, a Reuters poll showed, underlining prospects for the economy’s recovery from the March 11 earthquake.
Discussion of plans for the Renault-Nissan alliance to take a majority stake in Russia’s AvtoVAZ is likely to take a few more months, a source familiar with the matter said.
Japan’s Nikkei business daily reported on Thursday (June 16) that Nissan Motor Co was in the final stages of talks to take a stake of about 25 percent in AvtoVAZ for up to $1 billion. Partner Renault SA already owns 25 percent of AvtoVAZ, Russia’s biggest car maker.
Prospects for a step-up in U.S. economic growth in the second half of the year are becoming clearer.
No.2 U.S. automaker Ford Motor Co expects its profit for the rest of the year to ease off from the 13-year high it reported for the first quarter, pinched by higher commodity costs, an executive said.
Tokyo stocks on Thursday (June 16) tracked Wall Street lower after it tumbled on escalating Greek debt woes and as U.S. data showed the world’s No.1 economy is facing a troubling mix of higher prices and weak growth, pointing to further losses.
Chinese industrial output in May beat market expectations with a 13.3 percent rise from a year before, compared with April’s 13.4 percent expansion, according to the National Bureau of Statistics (NBS).
(Reuters, June 16, 2011)
Rubber market on June 15: Mixed trend in rubber
June 15, 2011
KOTTAYAM, JUNE 15:
Spot rubber saw a mixed trend on Wednesday. The undercurrent was firm as RSS 5 and ungraded rubber improved following comparatively better demand.
Weather variations seemed to have confused traders who decided to wait for clarity after the expiry of the June futures on the National Multi Commodity Exchange.
According to traders, sheet rubber finished flat at Rs 227.50 a kg amidst low volumes. The grade improved to Rs 227.50 (227) a kg both at Kottayam and Kochi, according to the Rubber Board.
The June series expired at Rs 229.25 (227.39) while the July series weakened to Rs 230.70 (231.93), August to Rs 232.43 (234.06), September to Rs 231.45 (232.58), October to Rs 229.01 (231.28) and November to Rs 229.80 (230.25) a kg for RSS 4 on NMCE.
RSS 3 (spot) slipped to Rs 231.65 (232.20) a kg at Bangkok. The June futures for the grade recovered to ¥414 (Rs 229.58) from ¥411.9 a kg during the day session and then to ¥416 (Rs 230.68) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 227.50 (227.50); RSS-5: 226 (225); ungraded: 222 (222); ISNR 20: 224 (223) and latex 60 per cent: 143 (143).
‘Kerala rubber convention can help showcase technology’
June 15, 2011
KOCHI, JUNE 15:
The Confederation of Indian Industry and the Rubber Board organised a one-day conference in Kottayam to create a platform showcasing developing technologies and ideas related to rubber processing. The theme of the conference, held under the banner of Kerala Rubber Convention 2011, was “Sustainable rubber manufacturing and processing.”
Inaugurating the session, Ms Sheela Thomas, Chairperson of Rubber Board, Government of India, said, “Kerala Rubber Convention will create a platform for showcasing technology, ideas and solutions and help rubber planters and micro, small and medium industries as well as regional and national players to attain economic sustainability in their operations.” The conference was also expected to enhance technological interventions and highlight Kerala’s potential as a promising investment destination.
India is the fourth-largest producer and third-largest consumer of natural rubber in the world. Over one million people are directly involved in farming of rubber, while another six million people are indirectly associated with this business. There are around 4,500 manufacturing units dependent on rubber.
STATE’S ECONOMY BENEFITS
Rubber is seen as key to the development of Kerala. The recent rally in rubber prices is estimated to have contributed significantly to the 10 per-cent-growth registered by the State’s economy. Close to 92 per cent of the nine lakh tonnes of rubber produced in India comes from Kerala.
“Today’s session will enhance technological intervention and highlight Kerala’s potential as a promising investment destination. This will also provide a platform for business meetings and knowing more about financing options,” Mr K.T. Thomas, Chairman of Kerala Rubber Convention 2011 and Director of Paragon Polymer Products, said.
Thursday, June 16, 2011
Mixed trend in rubber
Mixed trend in rubber
KOTTAYAM, JUNE 15:
Spot rubber saw a mixed trend on Wednesday. The undercurrent was firm as RSS 5 and ungraded rubber improved following comparatively better demand.
Weather variations seemed to have confused traders who decided to wait for clarity after the expiry of the June futures on the National Multi Commodity Exchange.
According to traders, sheet rubber finished flat at Rs 227.50 a kg amidst low volumes. The grade improved to Rs 227.50 (227) a kg both at Kottayam and Kochi, according to the Rubber Board.
The June series expired at Rs 229.25 (227.39) while the July series weakened to Rs 230.70 (231.93), August to Rs 232.43 (234.06), September to Rs 231.45 (232.58), October to Rs 229.01 (231.28) and November to Rs 229.80 (230.25) a kg for RSS 4 on NMCE.
RSS 3 (spot) slipped to Rs 231.65 (232.20) a kg at Bangkok. The June futures for the grade recovered to ¥414 (Rs 229.58) from ¥411.9 a kg during the day session and then to ¥416 (Rs 230.68) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 227.50 (227.50); RSS-5: 226 (225); ungraded: 222 (222); ISNR 20: 224 (223) and latex 60 per cent: 143 (143).
India: Call for more efforts to develop rubber goods sector
June 15, 2011
KOTTAYAM, JUNE 15:
The Rubber Board Chairperson, Ms Sheela Thomas, has inaugurated the Kerala Rubber Convention 2011 here, organised by the CII (Kerala chapter).
She said 60 per cent of rubber produced in the country was consumed by the tyre sector.
Mr Jose Dominic, Chairman, CII Kerala chapter, stressed the need for more efforts to develop the manufacturing industry in the state by making utmost use of resources and market opportunities.
India: Rubber Board of India Chairperson Highlights Need To Create Sustainability in Rubber Manufacturing
June 15, 2011
Sheela Thomas, on Tuesday (June 14) stressed on the need to create sustainability in rubber manufacturing.
Inaugurating the Kerala Rubber Convention 2011 that was organised by the Confederation of Indian Industry (CII), Ms. Thomas said that although the state has been a frontrunner in terms of production of natural rubber, it has failed to achieve its potential in the industry. “The non-tyre sector of the rubber industry continues to struggle in the market. The Cost-effectiveness and competitiveness of the products should be sustained. Moreover, high standards of quality should also be maintained in the industry. We can never come competitive without ensuring good quality. Consequently, good returns for products are necessary in ensuring interest among rubber growers.
She expressed optimism that participants of the Kerala Rubber Convention would emerge at milestones (in devising sustainable methods in the rubber manufacturing industry) that could be attained within a definite period of time. “The convention should also throw ideas towards the formulation of the 12th Five-year plan,” said Ms. Thomas.
In his opening remarks, Chairman of the CII Kerala State Council Jose Dominic pointed out that greater efforts must be made to develop the manufacturing industry in the state by making utmost utilisation of the available resources and market opportunities.
Kerala Rubber Convention chairman K.T. Thomas said that such programmes would provide a platform for discussing the various business opportunities provided by the rubber manufacturing and processing industry.
A.V. George, Chairman of the CII Kottayam Zonal Council delivered the concluding remarks.
Various plenary sessions were held as part of the programme. Prominent dignitaries who had participated in the sessions include Consul General of Thailand Dr. Paisan Maraprygsavan, Consul General of Malaysia Anuar Kasman, Indonesian Trade Promotion Director Aksamil Khair; Managing Director of Harrisons Malayalam Ltd. Pankaj Kapoor; Director-General of Automotive Tyre Manufacturers’ Association Rajiv Budhraja; and Rubber Research Institute of India Director Dr. James Jacob.
(The Hindu Business Line, India, June 15, 2011)
Apollo Tyres enters Sri Lanka market
June 15, 2011
Haryana, India – India’s largest tire manufacturer, Apollo Tyres, entered the Sri Lanka market through a tie-up with Ideal Motors, the automobile distribution and marketing arm of the Ideal Group of Companies. The Ideal Group is one of Sri Lanka’s fastest growing automobile majors with a focus on assembly, distribution of automotive spares and accessories with multiple outlets throughout the island. Ideal has also formed a new company, Ideal Wheels & Tyres, for the distribution and retailing of Apollo tires.
Initially Apollo Tyres will focus on passenger vehicle and cross-ply truck and light truck tires. This will be gradually expanded over time to include Apollo’s entire range currently sold in India, including truck, bus, radial, agriculture and off-highway tires, if and when needed.
China importing more rubber to keep up with auto markets demands
June 15, 2011
Natural rubber demand in world’slargest auto market China continued to boost the commodity as the demand expected to climb by nearly 8 percent, analysts said.
According to China Rubber Industry Association, country’s rubber demand is expected to hit to 2.89 million tons on strong growth in the vehicle market.
Meanwhile, China’s rubber imports are also on the rise as imports for May hit 120,000 tons, up 33.3% more than the 90,000 tons it imported in the same period of last year.
The May imports, however, were 33.3% less than the 180,000 tons imports in April.
In the first five months of 2011, China’s natural rubber imports swelled 6.4% year on year to 770,000 tons. China imported 1.71 million tons of natural rubber.
Last month, the country imported 122,063 tons of synthetic rubber, down 9.5% year on year from 134,845 tons but up 3.2% month on month from 118,300 tons.
During the five-month period, China’s synthetic rubber imports totaled 625,325 tons, down 13.9% year on year.
According to a separate report from General Administration of Customs, China imported $1.31 billion worth of natural rubber in the first quarter of this year, reflecting a year-on-year jump of 145.4%, and the average import price stood at US$2,600 per ton, doubled that of the first quarter of last year.
Analysts said the surged imported prices of natural rubber were caused by severe drought principally in the Southeast Asian countries, such as Thailand, Indonesia, Malaysia and Vietnam.
China’s natural rubber production growth almay be little changed this year as a drought in key growing regions curbs output, according China Natural Rubber Association.
Drought in Yunnan is particularly dire as the region accounts for 40 percent of total production and is China’s second-largest rubber producer after Hainan province.
China overtook the US as the world’s largest auto market in 2009 as government stimulus boosted sales by more than 40 percent. Total tire consumption will rise to more than 404 million tires in 2010 compared with a record 380 million last year, China Rubber Industry Association’s Fan said.
KOTTAYAM, JUNE 15:
Spot rubber saw a mixed trend on Wednesday. The undercurrent was firm as RSS 5 and ungraded rubber improved following comparatively better demand.
Weather variations seemed to have confused traders who decided to wait for clarity after the expiry of the June futures on the National Multi Commodity Exchange.
According to traders, sheet rubber finished flat at Rs 227.50 a kg amidst low volumes. The grade improved to Rs 227.50 (227) a kg both at Kottayam and Kochi, according to the Rubber Board.
The June series expired at Rs 229.25 (227.39) while the July series weakened to Rs 230.70 (231.93), August to Rs 232.43 (234.06), September to Rs 231.45 (232.58), October to Rs 229.01 (231.28) and November to Rs 229.80 (230.25) a kg for RSS 4 on NMCE.
RSS 3 (spot) slipped to Rs 231.65 (232.20) a kg at Bangkok. The June futures for the grade recovered to ¥414 (Rs 229.58) from ¥411.9 a kg during the day session and then to ¥416 (Rs 230.68) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 227.50 (227.50); RSS-5: 226 (225); ungraded: 222 (222); ISNR 20: 224 (223) and latex 60 per cent: 143 (143).
India: Call for more efforts to develop rubber goods sector
June 15, 2011
KOTTAYAM, JUNE 15:
The Rubber Board Chairperson, Ms Sheela Thomas, has inaugurated the Kerala Rubber Convention 2011 here, organised by the CII (Kerala chapter).
She said 60 per cent of rubber produced in the country was consumed by the tyre sector.
Mr Jose Dominic, Chairman, CII Kerala chapter, stressed the need for more efforts to develop the manufacturing industry in the state by making utmost use of resources and market opportunities.
India: Rubber Board of India Chairperson Highlights Need To Create Sustainability in Rubber Manufacturing
June 15, 2011
Sheela Thomas, on Tuesday (June 14) stressed on the need to create sustainability in rubber manufacturing.
Inaugurating the Kerala Rubber Convention 2011 that was organised by the Confederation of Indian Industry (CII), Ms. Thomas said that although the state has been a frontrunner in terms of production of natural rubber, it has failed to achieve its potential in the industry. “The non-tyre sector of the rubber industry continues to struggle in the market. The Cost-effectiveness and competitiveness of the products should be sustained. Moreover, high standards of quality should also be maintained in the industry. We can never come competitive without ensuring good quality. Consequently, good returns for products are necessary in ensuring interest among rubber growers.
She expressed optimism that participants of the Kerala Rubber Convention would emerge at milestones (in devising sustainable methods in the rubber manufacturing industry) that could be attained within a definite period of time. “The convention should also throw ideas towards the formulation of the 12th Five-year plan,” said Ms. Thomas.
In his opening remarks, Chairman of the CII Kerala State Council Jose Dominic pointed out that greater efforts must be made to develop the manufacturing industry in the state by making utmost utilisation of the available resources and market opportunities.
Kerala Rubber Convention chairman K.T. Thomas said that such programmes would provide a platform for discussing the various business opportunities provided by the rubber manufacturing and processing industry.
A.V. George, Chairman of the CII Kottayam Zonal Council delivered the concluding remarks.
Various plenary sessions were held as part of the programme. Prominent dignitaries who had participated in the sessions include Consul General of Thailand Dr. Paisan Maraprygsavan, Consul General of Malaysia Anuar Kasman, Indonesian Trade Promotion Director Aksamil Khair; Managing Director of Harrisons Malayalam Ltd. Pankaj Kapoor; Director-General of Automotive Tyre Manufacturers’ Association Rajiv Budhraja; and Rubber Research Institute of India Director Dr. James Jacob.
(The Hindu Business Line, India, June 15, 2011)
Apollo Tyres enters Sri Lanka market
June 15, 2011
Haryana, India – India’s largest tire manufacturer, Apollo Tyres, entered the Sri Lanka market through a tie-up with Ideal Motors, the automobile distribution and marketing arm of the Ideal Group of Companies. The Ideal Group is one of Sri Lanka’s fastest growing automobile majors with a focus on assembly, distribution of automotive spares and accessories with multiple outlets throughout the island. Ideal has also formed a new company, Ideal Wheels & Tyres, for the distribution and retailing of Apollo tires.
Initially Apollo Tyres will focus on passenger vehicle and cross-ply truck and light truck tires. This will be gradually expanded over time to include Apollo’s entire range currently sold in India, including truck, bus, radial, agriculture and off-highway tires, if and when needed.
China importing more rubber to keep up with auto markets demands
June 15, 2011
Natural rubber demand in world’slargest auto market China continued to boost the commodity as the demand expected to climb by nearly 8 percent, analysts said.
According to China Rubber Industry Association, country’s rubber demand is expected to hit to 2.89 million tons on strong growth in the vehicle market.
Meanwhile, China’s rubber imports are also on the rise as imports for May hit 120,000 tons, up 33.3% more than the 90,000 tons it imported in the same period of last year.
The May imports, however, were 33.3% less than the 180,000 tons imports in April.
In the first five months of 2011, China’s natural rubber imports swelled 6.4% year on year to 770,000 tons. China imported 1.71 million tons of natural rubber.
Last month, the country imported 122,063 tons of synthetic rubber, down 9.5% year on year from 134,845 tons but up 3.2% month on month from 118,300 tons.
During the five-month period, China’s synthetic rubber imports totaled 625,325 tons, down 13.9% year on year.
According to a separate report from General Administration of Customs, China imported $1.31 billion worth of natural rubber in the first quarter of this year, reflecting a year-on-year jump of 145.4%, and the average import price stood at US$2,600 per ton, doubled that of the first quarter of last year.
Analysts said the surged imported prices of natural rubber were caused by severe drought principally in the Southeast Asian countries, such as Thailand, Indonesia, Malaysia and Vietnam.
China’s natural rubber production growth almay be little changed this year as a drought in key growing regions curbs output, according China Natural Rubber Association.
Drought in Yunnan is particularly dire as the region accounts for 40 percent of total production and is China’s second-largest rubber producer after Hainan province.
China overtook the US as the world’s largest auto market in 2009 as government stimulus boosted sales by more than 40 percent. Total tire consumption will rise to more than 404 million tires in 2010 compared with a record 380 million last year, China Rubber Industry Association’s Fan said.
Wednesday, June 15, 2011
Rubber prices firm up on lean season hopes
Rubber prices firm up on lean season hopes
June 14, 2011
After a period of fluctuation towards May-end , rubber prices have been witnessing a steady trend. Though growers are hopeful of a further rise in prices , the possibility of higher imports might affect market sentiments . The prices rose from Rs 217 per kg towards the end of May to Rs 226 as on Monday, as the sector entered the lean production season in June. Domestic prices have been steady despite a slight fall in international prices from Rs 233.07 per kg on Saturday to Rs 231.84 per kg on Monday.
“Widespread rains have affected rubber production in most parts of the state. Tapping was done for a few days in areas where rain guarding of trees have been done,” said KK Abraham , president of the Palai Rubber Marketing Cooperative Society . Production might receive a setback as the monsoon is expected to intensity in the coming weeks. “We expect prices to go up in the coming weeks,” he said. “That it has not fallen from the present level despite high imports and better production is an encouraging sign for growers” , he added. Production was 4.6 % higher in April 2011 compared to the previous year.
Though the figures have not been finalised so far, the output is expected to be higher in May too. Imports were at 6,518 ton-ne in April but th-ey rose to 16,293 tonne in May. Ev-en then, the cumulative imports of 22,871 tonne in April and May this year are 14% lower than the inward shipments during the same period last year. Though higher availability has brought down prices in May, the lean season starting from June 1 took them to the present levels.
Rubber extends beyond Kerala: Maharashtra, the next hot spot
June 13, 2011
KOCHI, INDIA (Commodity Online): Kerala has long been a potent source of natural rubber in India. In fact 90% of India’s natural rubber output comes from Kerala. But analysts argue that the plantations in Kerala have reached a saturation point. And this has prompted India’s Rubber Board to seek land outside Kerala, where rubber could be cultivated. North Eastern States like Tripura, which has climatic conditions akin to that of Kerala were focused initially. But eventually, other States with potential for rubber cultivation were discovered: Maharashtra and Goa.
In the 1960s, ‘trial runs’ were carried out in Maharashtra and Goa for analysing the potential of natural rubber. In 1979, under the New Planting Scheme, regions were identified in Goa where rubber planting could be carried out.
Latest figures sourced from Rubber Board inform that there are 220 holdings of natural rubber in Maharashtra and 195 holdings in Goa. Together they account for 415 holdings of natural rubber.
In Maharashtra, 900 ha of natural rubber are planted while in Goa, 700 hectares have been planted rubber. Of these, 100 hectares in Maharashtra is mature area or worthy of tapping while in Goa this figure is at 650 hectares. Goa yields 900 tons/year; an average 1400 kg/ha while Maharashtra yields 200 tons/year; an average of 2 tons/ha.
Almost 60% of Goa rubber trees have grown old and needs re-plantation while in contrast, Maharashtra rubber trees are relatively young; which explains their enhanced yields.
In the ensuing five years, the Rubber Board has decided to plant 2500 ha of rubber in new planting in Maharashtra and 500 hectares of replanting in Goa. This totals about 3000 hectares.
With 10,000 ha of land recognised as having potential for rubber cultivation in Sindhudurga and Ratnagiri districts, unconfirmed sources peg Maharashtra rubber cultivation acreage potential at 50,000 hectares!
However there are hurdles to be cleared which are embedded within the system: the land rules.
“Currently, according to the law of land, in a Hindu Undivided Family system, consensus among the family members is vital for starting off with an activity in a land owned collectively. Without the consent of all the members, it would be difficult to start off. But with a string of generations owning the land, it would be difficult, if not impossible to trace each and every link in the family and earn their consent, who invariably would be scattered. Sometimes, the consent would be required from about 60-70 people.”—said a Rubber Board official.
Further, in Maharashtra, only farmers are entitled to buy agricultural land.”Unless you can prove that you are a farmer, you will not be able to buy agriculture land in Maharashtra; however rich you may be…” added the Rubber Board official.
In Maharashtra, rubber trees need additional care in the form of irrigation and fencing. Private nurseries in rubber are also missing.
In Goa too, there are stumbling blocks in the form of Tree Preservation Act.
“In Goa, if you have to cut down a tree, you not only need the consent of the government, but also furnish a chalan of Rs.300/ tree. Only, cashew and coconut are exempted from the rule. This law acts as a deterrent when it comes to replanting rubber (which involves cutting down rubber trees and planting new ones)…” the Rubber Board official explained.
“We have requested the state government to also exempt rubber from the ambit of Tree Preservation Act.” the official said.
“The Rubber Board is only a facilitator. Policy decisions have to come from the governments.” the official concluded.
June 14, 2011
After a period of fluctuation towards May-end , rubber prices have been witnessing a steady trend. Though growers are hopeful of a further rise in prices , the possibility of higher imports might affect market sentiments . The prices rose from Rs 217 per kg towards the end of May to Rs 226 as on Monday, as the sector entered the lean production season in June. Domestic prices have been steady despite a slight fall in international prices from Rs 233.07 per kg on Saturday to Rs 231.84 per kg on Monday.
“Widespread rains have affected rubber production in most parts of the state. Tapping was done for a few days in areas where rain guarding of trees have been done,” said KK Abraham , president of the Palai Rubber Marketing Cooperative Society . Production might receive a setback as the monsoon is expected to intensity in the coming weeks. “We expect prices to go up in the coming weeks,” he said. “That it has not fallen from the present level despite high imports and better production is an encouraging sign for growers” , he added. Production was 4.6 % higher in April 2011 compared to the previous year.
Though the figures have not been finalised so far, the output is expected to be higher in May too. Imports were at 6,518 ton-ne in April but th-ey rose to 16,293 tonne in May. Ev-en then, the cumulative imports of 22,871 tonne in April and May this year are 14% lower than the inward shipments during the same period last year. Though higher availability has brought down prices in May, the lean season starting from June 1 took them to the present levels.
Rubber extends beyond Kerala: Maharashtra, the next hot spot
June 13, 2011
KOCHI, INDIA (Commodity Online): Kerala has long been a potent source of natural rubber in India. In fact 90% of India’s natural rubber output comes from Kerala. But analysts argue that the plantations in Kerala have reached a saturation point. And this has prompted India’s Rubber Board to seek land outside Kerala, where rubber could be cultivated. North Eastern States like Tripura, which has climatic conditions akin to that of Kerala were focused initially. But eventually, other States with potential for rubber cultivation were discovered: Maharashtra and Goa.
In the 1960s, ‘trial runs’ were carried out in Maharashtra and Goa for analysing the potential of natural rubber. In 1979, under the New Planting Scheme, regions were identified in Goa where rubber planting could be carried out.
Latest figures sourced from Rubber Board inform that there are 220 holdings of natural rubber in Maharashtra and 195 holdings in Goa. Together they account for 415 holdings of natural rubber.
In Maharashtra, 900 ha of natural rubber are planted while in Goa, 700 hectares have been planted rubber. Of these, 100 hectares in Maharashtra is mature area or worthy of tapping while in Goa this figure is at 650 hectares. Goa yields 900 tons/year; an average 1400 kg/ha while Maharashtra yields 200 tons/year; an average of 2 tons/ha.
Almost 60% of Goa rubber trees have grown old and needs re-plantation while in contrast, Maharashtra rubber trees are relatively young; which explains their enhanced yields.
In the ensuing five years, the Rubber Board has decided to plant 2500 ha of rubber in new planting in Maharashtra and 500 hectares of replanting in Goa. This totals about 3000 hectares.
With 10,000 ha of land recognised as having potential for rubber cultivation in Sindhudurga and Ratnagiri districts, unconfirmed sources peg Maharashtra rubber cultivation acreage potential at 50,000 hectares!
However there are hurdles to be cleared which are embedded within the system: the land rules.
“Currently, according to the law of land, in a Hindu Undivided Family system, consensus among the family members is vital for starting off with an activity in a land owned collectively. Without the consent of all the members, it would be difficult to start off. But with a string of generations owning the land, it would be difficult, if not impossible to trace each and every link in the family and earn their consent, who invariably would be scattered. Sometimes, the consent would be required from about 60-70 people.”—said a Rubber Board official.
Further, in Maharashtra, only farmers are entitled to buy agricultural land.”Unless you can prove that you are a farmer, you will not be able to buy agriculture land in Maharashtra; however rich you may be…” added the Rubber Board official.
In Maharashtra, rubber trees need additional care in the form of irrigation and fencing. Private nurseries in rubber are also missing.
In Goa too, there are stumbling blocks in the form of Tree Preservation Act.
“In Goa, if you have to cut down a tree, you not only need the consent of the government, but also furnish a chalan of Rs.300/ tree. Only, cashew and coconut are exempted from the rule. This law acts as a deterrent when it comes to replanting rubber (which involves cutting down rubber trees and planting new ones)…” the Rubber Board official explained.
“We have requested the state government to also exempt rubber from the ambit of Tree Preservation Act.” the official said.
“The Rubber Board is only a facilitator. Policy decisions have to come from the governments.” the official concluded.
Tuesday, June 14, 2011
India: IRDF seeks transparency in rubber futures trading
India: IRDF seeks transparency in rubber futures trading
June 12, 2011
High volatility has been a major issue with the farmers
The worst hit under this scenario were small traders
Physical delivery in the NR futures trading is low
KOTTAYAM: The Indian Rubber Dealers’ Federation (IRDF) has called for steps to make the futures trading in natural rubber more transparent.
President George Valy says the high volatility has been a major issue with the farmers, traders, and the consuming industry ever since it was introduced. At present, the daily fluctuation comes up to four per cent (3 per cent plus 1 per cent for cooling period) of the price quoted. This means at a price of Rs.200 a kg, it can go up to Rs. 208 or Rs.192. This in real terms denotes a fluctuation of Rs.16 a kg for natural rubber.
He said the worst hit under this scenario were small traders who were the backbone of rubber trading and who had played a vital role in ensuring one of the highest farm gate price for the product in the world. The high volatility had made many of them keep off trading and this in term had hit the farmers, Mr. Valy said.
Mr. Valy said it was imperative to put the daily cap for futures trading at one plus one per cent .The high volatility may give enough scope for insider trading, he pointed out.
He pointed out that physical delivery in the NR futures trading was abysmally low. For May futures, which had a total volume of 2.5 lakh tonnes, the physically delivery was only 0.8 per cent. The consumer industries, trading community, and the Rubber Board had repeatedly made submissions for taking steps for ensuring a more transparent system so that unprofessional practices could be done away with, Mr. Valy said.
He said the IRDF had made submissions to Union Minister of State for Consumer Affairs and Food and Public Distribution K.V. Thomas and to the Chief Minister to look into the issue. The IRDF had been invited by the Union Minister for further discussion on the matter, Mr. Valy said.
Malaysia Apr Rubber Output Up 18pc on Year Malaysia
June 13, 2011
Malaysia produced 62,363 tonnes of natural rubber (NR) in April this year, an increase of 18.3 per cent when compared to a year ago.
However, on a month-to-month basis, output declined by 625 tonnes, or 0.9 per cent, the Statistics Department said in its rubber statistics summary released today.
It said the smallholding sector contributed 95.7 per cent of total output while the share from the estate sector amounted to 4.3 per cent.
The level of stocks in April 2011 fell by 30,377 tonnes, or 19.4 per cent, to 126,584 tonnes from the level in the previous month.
As for exports, 99,112 tonnes of NR were shipped in April 2011, which were down by 10.7 per cent when compared with the previous month but were higher by 44.8 per cent when compared with April last year.
NR imports in April 2011 amounted to 46,179 tonnes, a decrease of 21.5 per cent over the previous month, and was down by 6.4 per cent year-on-year.
Domestic consumption of NR in April 2011 was at 32,184 tonnes, a decline of 11.4 per cent over March 2011 and was down by 14.4 per cent year-on-year.
The average monthly price of latex concentrate in April 2011 continued to surge. Year-on-year, it increased by 38.1 per cent to 1,044.60 sen and average price for SMR 20 surged by 42.5 per cent to 1,490.38 sen.
(Business Times, Malaysia, June 10, 2011)
TOCOM rubber lacklustre, NMCE follows suit
June 13, 2011
TOKYO (Commodity Online): TOCOM rubber continues to be in red with July contract losing least (0.1 yen) and August contract losing most (4.5 yen) on 13.50 JST. The near month June contract was trading at 418.1 yen, a loss of 0.7 yen. November contract of far months was trading at 383.7 yen with a loss of 1.2 yen.
All NMCE rubber contracts are in red. June contract was traded for Rs.22550 after touching a high of Rs.22599 and a low of Rs.22447. Meanwhile August contract, subsequent to touching a high of 23250 and a low of 23165, was seen trading at the latter price.
Also, with concerns looming pertaining to the economic slowdown in US and China, oil futures slid 0.6% last week. This, along with strong dollar and possibility of surplus have played their part in bringing down rubber prices.
Meanwhile firm demand is expected to reflect in the steady trading of Malaysian rubber this week.
On a week-to-week basis,Malaysian Rubber Board’s official physical noon price for tyre-grade SMR 20 jumped 1.5 sen to 1,390.5 sen per kg from the previous Friday’s 1,389.0 sen per kg. Latex in bulk dropped by 5.5 sen to 941.5 sen per kg from 947.0 sen per kg previously.
Japan Rubber Stocks Fall 3.5 Pct By May 31 versus May 20
June 13, 2011
Japan’s crude rubber inventories fell 3.5 percent in the period from May 20 to May 31, industry data showed on Monday (June 13), reflecting firmer demand from automakers as their production gradually recovered from disruptions after a massive earthquake in March.
The Rubber Trade Association of Japan data showed that crude rubber inventories as of May 31 at 7,691 tonnes were nearly double the year-earlier level of 4,054 tonnes.
Rubber stocks fell steadily around this time last year as persistently high prices in producing countries put rubber futures prices on the Tokyo Commodity Exchange at a discount to physical prices, making shippers reluctant to deliver cargoes to Japan.
So far in 2011, crude rubber stocks have mostly steadied above 7,000 tonnes.
Following are details of the association data (in tonnes):
June 12, 2011
High volatility has been a major issue with the farmers
The worst hit under this scenario were small traders
Physical delivery in the NR futures trading is low
KOTTAYAM: The Indian Rubber Dealers’ Federation (IRDF) has called for steps to make the futures trading in natural rubber more transparent.
President George Valy says the high volatility has been a major issue with the farmers, traders, and the consuming industry ever since it was introduced. At present, the daily fluctuation comes up to four per cent (3 per cent plus 1 per cent for cooling period) of the price quoted. This means at a price of Rs.200 a kg, it can go up to Rs. 208 or Rs.192. This in real terms denotes a fluctuation of Rs.16 a kg for natural rubber.
He said the worst hit under this scenario were small traders who were the backbone of rubber trading and who had played a vital role in ensuring one of the highest farm gate price for the product in the world. The high volatility had made many of them keep off trading and this in term had hit the farmers, Mr. Valy said.
Mr. Valy said it was imperative to put the daily cap for futures trading at one plus one per cent .The high volatility may give enough scope for insider trading, he pointed out.
He pointed out that physical delivery in the NR futures trading was abysmally low. For May futures, which had a total volume of 2.5 lakh tonnes, the physically delivery was only 0.8 per cent. The consumer industries, trading community, and the Rubber Board had repeatedly made submissions for taking steps for ensuring a more transparent system so that unprofessional practices could be done away with, Mr. Valy said.
He said the IRDF had made submissions to Union Minister of State for Consumer Affairs and Food and Public Distribution K.V. Thomas and to the Chief Minister to look into the issue. The IRDF had been invited by the Union Minister for further discussion on the matter, Mr. Valy said.
Malaysia Apr Rubber Output Up 18pc on Year Malaysia
June 13, 2011
Malaysia produced 62,363 tonnes of natural rubber (NR) in April this year, an increase of 18.3 per cent when compared to a year ago.
However, on a month-to-month basis, output declined by 625 tonnes, or 0.9 per cent, the Statistics Department said in its rubber statistics summary released today.
It said the smallholding sector contributed 95.7 per cent of total output while the share from the estate sector amounted to 4.3 per cent.
The level of stocks in April 2011 fell by 30,377 tonnes, or 19.4 per cent, to 126,584 tonnes from the level in the previous month.
As for exports, 99,112 tonnes of NR were shipped in April 2011, which were down by 10.7 per cent when compared with the previous month but were higher by 44.8 per cent when compared with April last year.
NR imports in April 2011 amounted to 46,179 tonnes, a decrease of 21.5 per cent over the previous month, and was down by 6.4 per cent year-on-year.
Domestic consumption of NR in April 2011 was at 32,184 tonnes, a decline of 11.4 per cent over March 2011 and was down by 14.4 per cent year-on-year.
The average monthly price of latex concentrate in April 2011 continued to surge. Year-on-year, it increased by 38.1 per cent to 1,044.60 sen and average price for SMR 20 surged by 42.5 per cent to 1,490.38 sen.
(Business Times, Malaysia, June 10, 2011)
TOCOM rubber lacklustre, NMCE follows suit
June 13, 2011
TOKYO (Commodity Online): TOCOM rubber continues to be in red with July contract losing least (0.1 yen) and August contract losing most (4.5 yen) on 13.50 JST. The near month June contract was trading at 418.1 yen, a loss of 0.7 yen. November contract of far months was trading at 383.7 yen with a loss of 1.2 yen.
All NMCE rubber contracts are in red. June contract was traded for Rs.22550 after touching a high of Rs.22599 and a low of Rs.22447. Meanwhile August contract, subsequent to touching a high of 23250 and a low of 23165, was seen trading at the latter price.
Also, with concerns looming pertaining to the economic slowdown in US and China, oil futures slid 0.6% last week. This, along with strong dollar and possibility of surplus have played their part in bringing down rubber prices.
Meanwhile firm demand is expected to reflect in the steady trading of Malaysian rubber this week.
On a week-to-week basis,Malaysian Rubber Board’s official physical noon price for tyre-grade SMR 20 jumped 1.5 sen to 1,390.5 sen per kg from the previous Friday’s 1,389.0 sen per kg. Latex in bulk dropped by 5.5 sen to 941.5 sen per kg from 947.0 sen per kg previously.
Japan Rubber Stocks Fall 3.5 Pct By May 31 versus May 20
June 13, 2011
Japan’s crude rubber inventories fell 3.5 percent in the period from May 20 to May 31, industry data showed on Monday (June 13), reflecting firmer demand from automakers as their production gradually recovered from disruptions after a massive earthquake in March.
The Rubber Trade Association of Japan data showed that crude rubber inventories as of May 31 at 7,691 tonnes were nearly double the year-earlier level of 4,054 tonnes.
Rubber stocks fell steadily around this time last year as persistently high prices in producing countries put rubber futures prices on the Tokyo Commodity Exchange at a discount to physical prices, making shippers reluctant to deliver cargoes to Japan.
So far in 2011, crude rubber stocks have mostly steadied above 7,000 tonnes.
Following are details of the association data (in tonnes):
Friday, June 10, 2011
Global rubber shortage to narrow this year
Global rubber shortage to narrow this year
June 8, 2011
A global natural-rubber shortage may narrow this year as high prices spur farmers from Indonesia to Myanmar to boost tapping, according to the International Rubber Study Group, potentially capping costs for tire and glove makers.
Production may increase 5.8 per cent to 10.9 million tonnes this year from 10.3 million tonnes a year earlier, Stephen Evans, secretary general at the group told the Global Rubber & Tire Markets conference in Jakarta on Wednesday. That may narrow the supply deficit to between 200,000 tonnes and 300,000 tonnes from 400,000 tonnes in 2010, he said.
Increased supplies may accelerate a 27 per cent decline in rubber prices from a record 535.7 yen a kilogram on February 18 and cap costs for companies such as Bridgestone Corp. and Michelin & Cie. Rubber advanced to an all-time high as global demand led by China outstripped supply after rain and flooding curbed output in Thailand and Indonesia, the two largest exporters.
“A high market price has stimulated a surge in tapping and also planting that will be a significant way to close the supply gap,” Evans said. “We see this is happening now and taking place in Myanmar, Cambodia and may be in Indonesia as well”, where farmers are highly sensitive to prices, he said.
Rubber futures have gained for four straight weeks and may extend the recovery from this year’s low of 335 yen a kg, according to broker Fujitomi Co. Rubber for November delivery fell as much as 2.2 per cent to 384 yen a kilogram ($4,902 a tonne) before trading at 390.3 yen at 3:26 pm local time on the Tokyo Commodity Exchange. Futures more than doubled in 2009 and surged 50 per cent last year.
PERSISTENT RAIN
Persistent rains in southern Thailand, the biggest grower, have disrupted tapping, slowing the resumption of the rubber harvest after the traditional February-to-May low-production season. A weakening La Nina weather event, which brought excess rains to Southeast Asia, may boost rubber output in the second half of this year, Evans said.
“We’re looking at a phase where we would continue to see high prices and a close balance between demand and supply,” said Rajeev M Pandia, director of Gujarat Reclaim & Rubber Products Ltd.
The global rubber shortage may widen to 1 million tonnes by 2020, as demand from tyre makers will boost consumption to about 15.4 million tonnes, Evans said. Demand this year may gain 4.7 per cent to 11.2 million tonnes, he said.
“China and India’s automotive sectors will continue to support demand,” he said. “China has a very big plan for expansion of their automotive sectors. Strong vehicle output will definitely lead to strong tire sales, especially for replacement, as 75 per cent of tyres are sold to the replacement markets.”
CAR SALES
China’s annual automobile sales may rise to 30 million vehicles in 2015 from 18 million last year, Xinhua News Agency reported on May 30, citing Dong Yang, deputy executive director of the China Association of Automobile Manufacturers. Car sales in India may more than double to 3 million by 2015, according to the government.
Global tyre demand is expanding at a faster pace than production, led by growth in China, as vehicle sales are increasing, Sumitomo Rubber Industries Ltd. President Ikuji Ikeda said on May 26.
Sales of passenger-car tyres worldwide are forecast to grow 6.1 per cent this year from 2010, while sales of commercial- vehicle tyres are forecast to rise 11 per cent, the International Rubber Study Group forecast on January 26.
Rubber weakens as buyers abstain
June 8, 2011
KOTTAYAM, JUNE 8:
Physical rubber prices ruled weak on Wednesday. There were no fresh incentives specific to the commodity from the domestic or international scene to keep the prices firm.
A positive change in weather during the past 48 hours in the absence of rains has prompted the buyers to stay back though it was only a temporary phenomenon during the season. The trend was mixed.
According to dealers, sheet rubber moved down to Rs 225 (226) a kg on buyer resistance. The grade dropped to Rs 225.50 (226.50) a kg both at Kottayam and Kochi, as reported by the Rubber Board.
The June series weakened to Rs 224.43 (225.07), July to Rs 228.50 (229.17), August to Rs 229.79 (230.27), September to Rs 228.75 (229.13) and November to Rs 228.00 (229.00) a kg on National Multi Commodity Exchange.
RSS 3 (spot) slipped further to Rs 234.48 (234. 64) a kg at Bangkok. The grade weakened at its June futures to ¥ 419.2 (Rs. 234.90) from ¥ 422.0 a kg during the day session but then remained inactive during the night session on Tokyo Commodity Exchange.
Spot rubber rates (Rs/kg) were: RSS-4: 225 (226), RSS-5: 223 (224), Ungraded: 220 (221), ISNR 20: 219 (219), and latex 60 per cent: 143 (143).
Rubber Demand May Rise to 11.2 Million Tons This Year, IRSG Says
June 9, 2011
Natural rubber demand may climb 4.7 percent this year as car sales in China and India expand, according to the International Rubber Study Group.
Global demand may increase to 11.2 million metric tons from 10.7 million last year, Stephen Evans, secretary general at the group told a conference in Jakarta today (June 8).
(Bloomberg, June 8, 2011)
Rubber Supply Gap May Narrow on Increased Tapping, Group Says
June 9, 2011
Natural rubber production may increase 5.8 percent this year as high prices spur growers to increase tapping, reducing a supply deficit, according to the InternationalRubber Study Group.
Output may increase to 10.9 million metric tons this year, compared with 10.3 million tons last year, Stephen Evans, secretary general at the group said in Jakarta today (June 8). That may narrow the supply deficit to 200,000-300,000 tons from 400,000 tons a year earlier, he said.
(Bloomberg, June 8, 2011)
June 8, 2011
A global natural-rubber shortage may narrow this year as high prices spur farmers from Indonesia to Myanmar to boost tapping, according to the International Rubber Study Group, potentially capping costs for tire and glove makers.
Production may increase 5.8 per cent to 10.9 million tonnes this year from 10.3 million tonnes a year earlier, Stephen Evans, secretary general at the group told the Global Rubber & Tire Markets conference in Jakarta on Wednesday. That may narrow the supply deficit to between 200,000 tonnes and 300,000 tonnes from 400,000 tonnes in 2010, he said.
Increased supplies may accelerate a 27 per cent decline in rubber prices from a record 535.7 yen a kilogram on February 18 and cap costs for companies such as Bridgestone Corp. and Michelin & Cie. Rubber advanced to an all-time high as global demand led by China outstripped supply after rain and flooding curbed output in Thailand and Indonesia, the two largest exporters.
“A high market price has stimulated a surge in tapping and also planting that will be a significant way to close the supply gap,” Evans said. “We see this is happening now and taking place in Myanmar, Cambodia and may be in Indonesia as well”, where farmers are highly sensitive to prices, he said.
Rubber futures have gained for four straight weeks and may extend the recovery from this year’s low of 335 yen a kg, according to broker Fujitomi Co. Rubber for November delivery fell as much as 2.2 per cent to 384 yen a kilogram ($4,902 a tonne) before trading at 390.3 yen at 3:26 pm local time on the Tokyo Commodity Exchange. Futures more than doubled in 2009 and surged 50 per cent last year.
PERSISTENT RAIN
Persistent rains in southern Thailand, the biggest grower, have disrupted tapping, slowing the resumption of the rubber harvest after the traditional February-to-May low-production season. A weakening La Nina weather event, which brought excess rains to Southeast Asia, may boost rubber output in the second half of this year, Evans said.
“We’re looking at a phase where we would continue to see high prices and a close balance between demand and supply,” said Rajeev M Pandia, director of Gujarat Reclaim & Rubber Products Ltd.
The global rubber shortage may widen to 1 million tonnes by 2020, as demand from tyre makers will boost consumption to about 15.4 million tonnes, Evans said. Demand this year may gain 4.7 per cent to 11.2 million tonnes, he said.
“China and India’s automotive sectors will continue to support demand,” he said. “China has a very big plan for expansion of their automotive sectors. Strong vehicle output will definitely lead to strong tire sales, especially for replacement, as 75 per cent of tyres are sold to the replacement markets.”
CAR SALES
China’s annual automobile sales may rise to 30 million vehicles in 2015 from 18 million last year, Xinhua News Agency reported on May 30, citing Dong Yang, deputy executive director of the China Association of Automobile Manufacturers. Car sales in India may more than double to 3 million by 2015, according to the government.
Global tyre demand is expanding at a faster pace than production, led by growth in China, as vehicle sales are increasing, Sumitomo Rubber Industries Ltd. President Ikuji Ikeda said on May 26.
Sales of passenger-car tyres worldwide are forecast to grow 6.1 per cent this year from 2010, while sales of commercial- vehicle tyres are forecast to rise 11 per cent, the International Rubber Study Group forecast on January 26.
Rubber weakens as buyers abstain
June 8, 2011
KOTTAYAM, JUNE 8:
Physical rubber prices ruled weak on Wednesday. There were no fresh incentives specific to the commodity from the domestic or international scene to keep the prices firm.
A positive change in weather during the past 48 hours in the absence of rains has prompted the buyers to stay back though it was only a temporary phenomenon during the season. The trend was mixed.
According to dealers, sheet rubber moved down to Rs 225 (226) a kg on buyer resistance. The grade dropped to Rs 225.50 (226.50) a kg both at Kottayam and Kochi, as reported by the Rubber Board.
The June series weakened to Rs 224.43 (225.07), July to Rs 228.50 (229.17), August to Rs 229.79 (230.27), September to Rs 228.75 (229.13) and November to Rs 228.00 (229.00) a kg on National Multi Commodity Exchange.
RSS 3 (spot) slipped further to Rs 234.48 (234. 64) a kg at Bangkok. The grade weakened at its June futures to ¥ 419.2 (Rs. 234.90) from ¥ 422.0 a kg during the day session but then remained inactive during the night session on Tokyo Commodity Exchange.
Spot rubber rates (Rs/kg) were: RSS-4: 225 (226), RSS-5: 223 (224), Ungraded: 220 (221), ISNR 20: 219 (219), and latex 60 per cent: 143 (143).
Rubber Demand May Rise to 11.2 Million Tons This Year, IRSG Says
June 9, 2011
Natural rubber demand may climb 4.7 percent this year as car sales in China and India expand, according to the International Rubber Study Group.
Global demand may increase to 11.2 million metric tons from 10.7 million last year, Stephen Evans, secretary general at the group told a conference in Jakarta today (June 8).
(Bloomberg, June 8, 2011)
Rubber Supply Gap May Narrow on Increased Tapping, Group Says
June 9, 2011
Natural rubber production may increase 5.8 percent this year as high prices spur growers to increase tapping, reducing a supply deficit, according to the InternationalRubber Study Group.
Output may increase to 10.9 million metric tons this year, compared with 10.3 million tons last year, Stephen Evans, secretary general at the group said in Jakarta today (June 8). That may narrow the supply deficit to 200,000-300,000 tons from 400,000 tons a year earlier, he said.
(Bloomberg, June 8, 2011)
Tuesday, June 7, 2011
Rubber prices may rise by about Rs 10 per kg this month
Rubber prices may rise by about Rs 10 per kg this month
June 5, 2011
New Delhi, Jun 5 (PTI) Natural rubber prices may rise by up to Rs 10/kg in the domestic market this month as production is expected to fall with the onset of monsoon in Kerala, a major producing region.
Rubber prices, which are currently ruling at Rs 226 per kg, are likely to rise further to Rs 235 per kg, traders said.
“As the monsoons have hit Kerala, tapping has stopped. Rubber prices may touch Rs 235/kg in June,” Indian Rubber Dealers Federation President George Valy said.
During monsoon, rubber productions almost stops as rains hinder tapping of rubber trees for latex.
He pointed out that farmers have curtailed supplies in last 2-3 days in anticipation of rise in rubber prices.
Valy, however, said that prices are unlikely to rise sharply as demand is expected to remain subdued as import has increased on low global prices and a change in import duty structure from 20 per cent of the price of the imported good to Rs 20 per kg or 20 per cent, whichever is lower.
Rubber prices at the international spot market in Bangkok are currently ruling at Rs 234.72 per kg.
Market analysts say that global spot rubber market is likely to remain firm due to limited supplies from Thailand because of rains, but it is unlikely to see a sharp rise with lesser demand from China.
There are also concerns over a slowdown in the US manufacturing sector, they added.
Rubber industry hurt by price fluctuations
June 6, 2011
UNSTABLE prices are reducing rubber exports this year, even though prices have increased sharply compared with last year, said exporters and producers.
Ko Htwe Nyein Aung, the owner of Sein Sein rubber production in South Okkalapa township, said rubber prices have increased since the last week of April.
“In the last week of April, 1 pound of Ribbed Smoked Sheet-1 [RSS] rubber cost K1400, RSS3 cost K1350 and RSS5 was K1300,” he said.
“But prices of export-quality rubber increased at the end of May to K1700 a pound for RSS1, K1600 for RSS3 and K1500 for RSS3,” he said.
However, he said that even though prices are higher this year, exporters are making less money.
“Rubber prices have increased sharply over last year. In June last year, a pound of RSS3 fetched K1200 and RSS5 was only selling for K1000. But exporters aren’t making much money this year because prices are changing too quickly, which is spooking buyers and sellers alike,” Ko Htwe Nyein Aung said.
U Kyaw Mya, a rubber exporter in Yangon, said he has reduced the amount of rubber he is stockpiling this year.
“We normally store large amounts of rubber to export but I’m not doing that this year because I don’t trust the export environment. Last year, I stockpiled about 100 tonnes to export but I’ve only bought about 40 tonnes this year,” he said.
U Khine Myint, the general secretary of the Myanmar Rubber Planters and Producers Association, said that demand from China, the largest buyer of Myanmar’s rubber, has fallen.
“Only 10 percent of our production goes to local market and 90pc of production is for export. This year, some tyre factories in China have faced labour problems and have reduced their production, which is why demand from China has decreased. And our buyers in Japan have postponed orders since the earthquake in March,” he said.
He added that local demand has also tailed off.
“Last year, local demand was great until March because shoemakers here made lots of orders but since then it has steadily dropped off. Since April this year we’ve had almost no orders,” U Khine Myint said.
NR prices largeley unchanged around $5
June 6, 2011
Tokyo — Prices on Tokyo’s rubber exchanges moved upward over the weekend on thin trading.
On Tokyo’s Tocom Exchange, prices for the six-month contract rose by about yen 1, closing at yen 390 ($4.87) per kg on Monday 6 June. Shorter-dated prices remained unchanged, trading at around yen 415.
In Singapore, SGX said short-dated RSS3 were trading unchanged from Friday at around $5.21 on thin trading with longer-dated contracts slightly higher, priced between $4.99 and $5.04. Short-dated TSR 20 was trading up by about $0.01 at $4.68.
In India, the NMCE saw June deliveries rise by Rs 2 to close at around Rs227 ($5.08) per kilo
In China, the Shanghai Futures Exchange also saw prices rise by a fraction of a yuan, with June deliveries trading at around Yuan 35.6 ($5.49) per kilo.
Expansion of rubber plantations benefitexperts some parties: research
June 5, 2011
The expansion of rubber plantations benefits only some parties when prices increase, and without better control the benefits will not offset the negative impacts on food security and the environment, according to a research paper.
Completed by Assoc Prof Somboon Jarernjiratrakul, an economics lecturer at Prince of Songkla University, the paper suggests a more organised approach to overseeing plantations for sustainability in economic and environmental terms.
Rubber plantations from 2004-10 expanded 5.91 per cent on average every year to 17.96 million rai in 2010 from 12.95 million rai in 2004. Thailand is second only to Indonesia at 21 million rai, but is the world’s largest rubber producer with 3 million tonnes last year versus 2.83 million tonnes from Indonesia.
“The plantation areas expanded largely due to price increases, which are driven by factors – higher demand for natural rubber, speculation in futures markets and higher prices of synthetic rubber. Expanding upon the external variables subjects farmers to risks and this will also affect food security and cause environmental as well as social impacts,” the researcher said.
On the economic front, farmers are more exposed to external factors, as rubber demand depends on economic growth, which becomes more and more unstable in the more globalised era. There is also no guarantee that in 10 years rubber demand in China – the world’s fastest-growing economy – would increase 12.90 per cent per year, like in the past decade.
Notably, rubber prices are driven up or down by quotations in the futures market and government policies, not purely by demand. This explains why the rubber price rose from less than Bt30 per kilogram in 2002 to nearly Bt200 this year.
The paper shows that in a Songkhla village, nearly all villagers own rubber farms – 15 rai on average per household. But 80 per cent of the households own one pickup truck.
Yet, speculation from February 21-March 14 this year drove down the rubber price in Thailand from Bt183.64 to Bt95, much below the usual gap with the Singapore price. But upon Deputy Prime Minister Suthep Thuagsuban’s assurance of higher prices on March 16, the price jumped to Bt121.38 on the next day and further to Bt169 on April 7.
Last but not least, Thai farmers are not alone in the world in turning to this commercial crop. Plantations have increased sharply in China, Vietnam and the Philippines. If the global economy turns dismal again and drives down demand, oversupply is very likely, the paper said.
As plantations expand quickly, this leads to huge demand for seedlings and to premature rubber cutting – and eventually lower quality. Worse, farmers now turn paddy fields into rubber farms and some encroach on forestland.
For example, half of the paddy fields in well-irrigated Tambon Harnpho of Chaison district in Phattalung have been converted into rubber plantations in the past three years.
In Khao Poo Khao Ya National Park in the South, 122,587 rai or 28.26 per cent of the park’s area now house rubber trees. Plantations are also seen in the Khlong U-Tapao watershed in the South. Encroachment in first- and second-tier watersheds is believed to affect biodiversity, with a single plant. Rubber trees are less able to absorb water and this could lead to lower natural water levels and landslides.
Plantations grow larger mainly when prices are high, with support from the government. Yet, the government has failed to adopt a long-term plan to develop the industry.
“There was a strategy to turn Thailand into the world’s rubber hub. But of the announced budget of Bt10 billion, only hundreds of millions have been invested. When the price was high (which allowed the government to reap Bt13.5 billion taxes from the export of 2.7 million tonnes in 2010), the government did nothing to put the money to good use.
“However, when the price fell, a strategy was launched but under pressure, it produced low yields. The rubber price intervention programme during 1993-2000, for example, cost the government Bt10.50 per kilogram,” he said.
A more streamlined strategy must be put in place to develop the rubber industry from upstream to downstream, the paper said.
In 2009, rubber exports – at a volume of 2.7 million tonnes – totalled Bt146.2 billion. But exports of rubber products like globes and tyres in the year, which consumed only 400,000 tonnes of para rubber as a raw material, hit Bt152.8 billion.
This shows that more downstream projects would generate a higher return for farmers and the entire economy.
For quality rubber and limited impacts on food plantations and forestland, the government should exert better control over the expansion of rubber plantations.
“All parties – the government, government units, farmers and others – must brainstorm to turn this zero-sum game or negative-sum game into a positive-sum game – where all parties are winners,” the paper concluded.
Spot rubber rules steady
June 5, 2011
KOTTAYAM, JUNE 4:
Spot rubber finished unchanged on Saturday. The weekend session was rather inactive since the domestic futures closed slightly lower on the National Multi Commodity Exchange (NMCE).
The June series slipped to Rs 227.68 (227.97), July to Rs 232 (232.92) and August to Rs 233.52 (234.19) while the September series inched up to Rs 232.51 (232.09), October to Rs 232 (229.80) and November to Rs 231.80 (231) a kg for RSS 4 on the NMCE.
Spot rates were (Rs/kg): RSS-4: 226 (226); RSS-5: 222 (222); ungraded: 218 (218); ISNR 20: 215 (215) and latex 60 per cent 135 (135).
June 5, 2011
New Delhi, Jun 5 (PTI) Natural rubber prices may rise by up to Rs 10/kg in the domestic market this month as production is expected to fall with the onset of monsoon in Kerala, a major producing region.
Rubber prices, which are currently ruling at Rs 226 per kg, are likely to rise further to Rs 235 per kg, traders said.
“As the monsoons have hit Kerala, tapping has stopped. Rubber prices may touch Rs 235/kg in June,” Indian Rubber Dealers Federation President George Valy said.
During monsoon, rubber productions almost stops as rains hinder tapping of rubber trees for latex.
He pointed out that farmers have curtailed supplies in last 2-3 days in anticipation of rise in rubber prices.
Valy, however, said that prices are unlikely to rise sharply as demand is expected to remain subdued as import has increased on low global prices and a change in import duty structure from 20 per cent of the price of the imported good to Rs 20 per kg or 20 per cent, whichever is lower.
Rubber prices at the international spot market in Bangkok are currently ruling at Rs 234.72 per kg.
Market analysts say that global spot rubber market is likely to remain firm due to limited supplies from Thailand because of rains, but it is unlikely to see a sharp rise with lesser demand from China.
There are also concerns over a slowdown in the US manufacturing sector, they added.
Rubber industry hurt by price fluctuations
June 6, 2011
UNSTABLE prices are reducing rubber exports this year, even though prices have increased sharply compared with last year, said exporters and producers.
Ko Htwe Nyein Aung, the owner of Sein Sein rubber production in South Okkalapa township, said rubber prices have increased since the last week of April.
“In the last week of April, 1 pound of Ribbed Smoked Sheet-1 [RSS] rubber cost K1400, RSS3 cost K1350 and RSS5 was K1300,” he said.
“But prices of export-quality rubber increased at the end of May to K1700 a pound for RSS1, K1600 for RSS3 and K1500 for RSS3,” he said.
However, he said that even though prices are higher this year, exporters are making less money.
“Rubber prices have increased sharply over last year. In June last year, a pound of RSS3 fetched K1200 and RSS5 was only selling for K1000. But exporters aren’t making much money this year because prices are changing too quickly, which is spooking buyers and sellers alike,” Ko Htwe Nyein Aung said.
U Kyaw Mya, a rubber exporter in Yangon, said he has reduced the amount of rubber he is stockpiling this year.
“We normally store large amounts of rubber to export but I’m not doing that this year because I don’t trust the export environment. Last year, I stockpiled about 100 tonnes to export but I’ve only bought about 40 tonnes this year,” he said.
U Khine Myint, the general secretary of the Myanmar Rubber Planters and Producers Association, said that demand from China, the largest buyer of Myanmar’s rubber, has fallen.
“Only 10 percent of our production goes to local market and 90pc of production is for export. This year, some tyre factories in China have faced labour problems and have reduced their production, which is why demand from China has decreased. And our buyers in Japan have postponed orders since the earthquake in March,” he said.
He added that local demand has also tailed off.
“Last year, local demand was great until March because shoemakers here made lots of orders but since then it has steadily dropped off. Since April this year we’ve had almost no orders,” U Khine Myint said.
NR prices largeley unchanged around $5
June 6, 2011
Tokyo — Prices on Tokyo’s rubber exchanges moved upward over the weekend on thin trading.
On Tokyo’s Tocom Exchange, prices for the six-month contract rose by about yen 1, closing at yen 390 ($4.87) per kg on Monday 6 June. Shorter-dated prices remained unchanged, trading at around yen 415.
In Singapore, SGX said short-dated RSS3 were trading unchanged from Friday at around $5.21 on thin trading with longer-dated contracts slightly higher, priced between $4.99 and $5.04. Short-dated TSR 20 was trading up by about $0.01 at $4.68.
In India, the NMCE saw June deliveries rise by Rs 2 to close at around Rs227 ($5.08) per kilo
In China, the Shanghai Futures Exchange also saw prices rise by a fraction of a yuan, with June deliveries trading at around Yuan 35.6 ($5.49) per kilo.
Expansion of rubber plantations benefitexperts some parties: research
June 5, 2011
The expansion of rubber plantations benefits only some parties when prices increase, and without better control the benefits will not offset the negative impacts on food security and the environment, according to a research paper.
Completed by Assoc Prof Somboon Jarernjiratrakul, an economics lecturer at Prince of Songkla University, the paper suggests a more organised approach to overseeing plantations for sustainability in economic and environmental terms.
Rubber plantations from 2004-10 expanded 5.91 per cent on average every year to 17.96 million rai in 2010 from 12.95 million rai in 2004. Thailand is second only to Indonesia at 21 million rai, but is the world’s largest rubber producer with 3 million tonnes last year versus 2.83 million tonnes from Indonesia.
“The plantation areas expanded largely due to price increases, which are driven by factors – higher demand for natural rubber, speculation in futures markets and higher prices of synthetic rubber. Expanding upon the external variables subjects farmers to risks and this will also affect food security and cause environmental as well as social impacts,” the researcher said.
On the economic front, farmers are more exposed to external factors, as rubber demand depends on economic growth, which becomes more and more unstable in the more globalised era. There is also no guarantee that in 10 years rubber demand in China – the world’s fastest-growing economy – would increase 12.90 per cent per year, like in the past decade.
Notably, rubber prices are driven up or down by quotations in the futures market and government policies, not purely by demand. This explains why the rubber price rose from less than Bt30 per kilogram in 2002 to nearly Bt200 this year.
The paper shows that in a Songkhla village, nearly all villagers own rubber farms – 15 rai on average per household. But 80 per cent of the households own one pickup truck.
Yet, speculation from February 21-March 14 this year drove down the rubber price in Thailand from Bt183.64 to Bt95, much below the usual gap with the Singapore price. But upon Deputy Prime Minister Suthep Thuagsuban’s assurance of higher prices on March 16, the price jumped to Bt121.38 on the next day and further to Bt169 on April 7.
Last but not least, Thai farmers are not alone in the world in turning to this commercial crop. Plantations have increased sharply in China, Vietnam and the Philippines. If the global economy turns dismal again and drives down demand, oversupply is very likely, the paper said.
As plantations expand quickly, this leads to huge demand for seedlings and to premature rubber cutting – and eventually lower quality. Worse, farmers now turn paddy fields into rubber farms and some encroach on forestland.
For example, half of the paddy fields in well-irrigated Tambon Harnpho of Chaison district in Phattalung have been converted into rubber plantations in the past three years.
In Khao Poo Khao Ya National Park in the South, 122,587 rai or 28.26 per cent of the park’s area now house rubber trees. Plantations are also seen in the Khlong U-Tapao watershed in the South. Encroachment in first- and second-tier watersheds is believed to affect biodiversity, with a single plant. Rubber trees are less able to absorb water and this could lead to lower natural water levels and landslides.
Plantations grow larger mainly when prices are high, with support from the government. Yet, the government has failed to adopt a long-term plan to develop the industry.
“There was a strategy to turn Thailand into the world’s rubber hub. But of the announced budget of Bt10 billion, only hundreds of millions have been invested. When the price was high (which allowed the government to reap Bt13.5 billion taxes from the export of 2.7 million tonnes in 2010), the government did nothing to put the money to good use.
“However, when the price fell, a strategy was launched but under pressure, it produced low yields. The rubber price intervention programme during 1993-2000, for example, cost the government Bt10.50 per kilogram,” he said.
A more streamlined strategy must be put in place to develop the rubber industry from upstream to downstream, the paper said.
In 2009, rubber exports – at a volume of 2.7 million tonnes – totalled Bt146.2 billion. But exports of rubber products like globes and tyres in the year, which consumed only 400,000 tonnes of para rubber as a raw material, hit Bt152.8 billion.
This shows that more downstream projects would generate a higher return for farmers and the entire economy.
For quality rubber and limited impacts on food plantations and forestland, the government should exert better control over the expansion of rubber plantations.
“All parties – the government, government units, farmers and others – must brainstorm to turn this zero-sum game or negative-sum game into a positive-sum game – where all parties are winners,” the paper concluded.
Spot rubber rules steady
June 5, 2011
KOTTAYAM, JUNE 4:
Spot rubber finished unchanged on Saturday. The weekend session was rather inactive since the domestic futures closed slightly lower on the National Multi Commodity Exchange (NMCE).
The June series slipped to Rs 227.68 (227.97), July to Rs 232 (232.92) and August to Rs 233.52 (234.19) while the September series inched up to Rs 232.51 (232.09), October to Rs 232 (229.80) and November to Rs 231.80 (231) a kg for RSS 4 on the NMCE.
Spot rates were (Rs/kg): RSS-4: 226 (226); RSS-5: 222 (222); ungraded: 218 (218); ISNR 20: 215 (215) and latex 60 per cent 135 (135).
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