India’s production to exceed overall output of rubber body nations
July 30, 2011
Thiruvananthapuram: During a tough season of domestic rubber shortage, India has found some consolation. The country’s natural rubber (NR) production growth in 2011 is poised to soar higher than the overall rubber output growth of ANRPC (Association of Natural Rubber Producing Countries). In absolute production volumes, however, India remains fourth among the nine top rubber producers.
The growth rate of rubber production in (January-December) 2011 in all ANRPC members is expected to be only 4.9%, according to the number-crunching by ANRPC countries. In the corresponding period, India’s rubber production is anticipated to perk up by 5.7%.
“Climatic conditions have been partial to Indian rubber plantations this season, while other rubber-producing countries like Malaysia and Thailand were affected by adverse situations like flood. Besides, India’s NR productivity has retained its lead among peer rubber farmers,” Sheela Thomas, chairman of Singapore-based International Rubber Study Group (IRSG), said, when contacted by FE.
Rubber producing region in Central Kerala did not go through too much rain or too much dry climate in the first half of 2011. Shortage of skilled labour was a grave issue, she admitted. “But even labour shortage is manageable, provided there are higher wages,” said Thomas, also chairman, Rubber Board.
By and large, Indian rubber has stayed disease-resistant. “Supply from Vietnam during the third quarter of 2011 is expected to fall 9.4% on year due to severe oidium leaf disease in its upcoming rubber regions,” says Tom Jose, Senior Economist, ANPRC. Among individual countries, only Phillipines, Cambodia and Indonesia are estimated to post a higher rubber production growth than India in 2011. In the second quarter of 2011, China even shows a growth rate of minus 13.9% in NR output.
According to all estimates, total supply from all ANRPC members during this year is anticipated at 9.959 million tonne. “This is 4% higher than that of previous year,” says Kamarul Baharain Bin Basir, secretary general, ANRPC in the latest statistical bulletin (July 2011) of the Kuala Lumpur-based rubber producers’ outfit.
At the same time, ANRPC warns that globally the NR supply situation may stay tight till 2018. While giving its detailed statistical forecasts on global NR supply from 2012 to 2018, the report argues that supply is unlikely to grow beyond 3-4% during 2012. The shortage would be more acute after 2016, it says.
Synthetic rubber demand bounces back
July 30, 2011
Boosted by a resurgent automotive sector, the synthetic rubber market will soon be awash with product as new capacities come on stream
Escalating costs and the short supply of key raw materials have signaled troubled times for synthetic rubber markets over the past year. Nevertheless, with the important automotive end-use sector on the road to recovery and the megatrend of mobility gaining impetus, demand for tires – a core outlet for synthetic rubber – is increasing and the outlook is looking more positive.
Yago Veith
Despite the greater price pressures leading to regular stories of closures and production cutbacks at rubber plants globally, there have also been plenty of investments announced – particularly in developing markets such as Asia – where demand continues to grow rapidly.
Global synthetic rubber consumption is forecast to reach 13.4m tonnes/year by 2015 (see table) from 2010 estimates of 11.4m, according to a report from US-based Global Industry Analysts, published last October.
ASIA IS KEY
Potential growth in the relatively untapped Asian market is vast, with far fewer people owning cars than in the more-established Western countries.
Higher disposable income and a middle class keen to become more mobile are driving this trend. As a result, many players are keen to tap into these promising markets.
There will be around 1.4bn cars on the roads by 2020 – 50% more than today, according to a report from CEIC, Bloomberg and Erste Group Research. In China alone, there will be 120 cars per 1,000 inhabitants by the end of the decade, up from 40 cars per 1,000 people today.
Speaking in May about future plans for the company, Mukesh Ambani, chairman of India’s Reliance Industries Limited (RIL), pointed to the importance of Asia: “The big trend is that if you look at the next 10 years, the projections for automobile growth are all China, India and Asia-focused,” he said.
Ron Commander, head of butyl operations at German specialty chemicals supplier LANXESS, echoed this sentiment: “About 54% of my business is in Asia and half of that is in China,” he said, adding that he expects its butyl business in Asia to grow by a few percentage points above this figure in the coming years. The market is very tight at the moment, driven by the mobility megatrend and an Asian middle class that continues to grow and want cars, added Commander.
DEMAND UPSURGE
The economic downturn may have affected new vehicle sales and temporarily punctured demand for replacement tires, but improved consumer awareness, a growing emphasis on fuel efficiency and more-stringent environmental regulations have seen an increase in global demand for high-performance tires.
North America’s ScotiaBank Group forecasts that global automotive sales will climb to over 60m units this year, marking a 5% increase on 2010 figures.
Styrene butadiene rubber (SBR) remains the largest segment in the synthetic rubber market and is used to produce tires that provide improved abrasion resistance, safety and fuel efficiency.
Other rubbers also are dependent on the performance of the automotive industry, such as nitrile rubber (NBR) – used in hoses, seals and grommets – and butyl rubber.
Regular butyl rubber is predominantly used in tire tubes for cars, trucks and bikes with halo butyl being used in inner liners and having several medical applications.
The map below shows some of the upcoming synthetic rubber projects.
The focus of the map is Asia as the majority of these plants are being built to tap into the rapidly growing demand requirements in the region.
1: MAP TA PHUT, THAILAND
Bangkok Synthetics (BST) is planning to build the first solution-polymerization styrene butadiene rubber(S-SBR) plant at Map Ta Phut, Thailand, in partnership with Japanese producer JSR The plant will have a capacity of 50,000-100,000 tonnes/year and is slated to start operations in June 2013. Besides the project, BST says it is also building a commercial nitrile butadiene latex plant that should come on stream in 2012 as it is developing an nitrile butadiene latex business mainly for medical glove applications.
2: NANJING, CHINA
Chinese synthetic rubber producer YPC-GPRO (Nanjing) Rubber (YGC) is planning a 100,000 tonne/year butadiene rubber plant in Eastern China. Construction at the site in Nanjing Chemical Industry Park was expected to start in April, with testing scheduled for December 2012.
3: TIANJIN, CHINA
China’s Tianjin Lugang Petroleum and Rubber started up its new 100,000 tonne/year styrene butadiene rubber (SBR) plant in March. Butadiene (BD) feedstock is supplied by Sinopec-SABIC’s joint-venture extraction unit at Tianjin, while styrene is mainly outsourced.
4: NORTHWEST CHINA
Xinjiang Land Fine Petrochemical is expected to start up its new 50,000 tonne/year polybutadiene rubber (PBR) plant in Northwest China in June or July. Construction started in April.
5: YEOSU, SOUTH KOREA
Asia’s largest synthetic rubber maker, Korea Kumho Petrochemical Co. (KKPC), started commercial production at its new 120,000 tonne/year butadiene rubber (BR) plant at Yeosu, South Korea, in March 2011.
6: JURONG ISLAND, SINGAPORE
Japan’s Sumitomo Chemical announced in November 2010 that it planned to build a 40,000 tonne/year solution styrene butadiene rubber (S-SBR) plant in Jurong Island, Singapore. The unit will serve Asia’s growing demand for tires and is expected to start commercial production in the fourth quarter of 2013. The plant is Sumitomo Chemical’s first manufacturing facility in Singapore, and the producer planned to spend “over yen (Y) 10bn ($120m)” on the project.
7: TIANJIN, CHINA
China’s Tianjin Lugang Petroleum and Rubber achieved on-spec product at its new 100,000 tonne/year styrene butadiene rubber (SBR) unit in northern Tianjin in March 2011. It was originally scheduled to start up by the end of 2010, but was delayed due to technical issues.
8: JURONG ISLAND, SINGAPORE
Japanese producer Asahi Kasei Chemicals started construction of its 100,000 tonne/year solution styrene butadiene rubber plant in Singapore in early June. A 50,000 tonne/year line will be built at the Jurong Island site under the first phase of the project and should come on stream in June 2013. A second line of the same capacity is expected to start up in early 2015.
9: QUANZHOU, CHINA
China’s Fuxiang Chemical – a joint venture between Fujian Petrochemical Industrial (59.6%), Meizhouwan Chlor-Alkali Industry (30.4%) and Fujian Huaxing Group (10%) – was scheduled to start up its new 100,000 tonne/year styrene butadiene rubber (SBR) unit in April 2011. The plant in Quanzhou, Fujian province, had originally been scheduled to start up by the end of 2010. A 50,000 tonne/year polybutadiene rubber (BR) unit at the site has also been built.
10: DONGMING, CHINA
China’s Shandong Yuhuang Chemical announced plans in March to build a 50,000 tonne/yearethylene-propylene rubber (EPR) plant at Dongming in Shandong. The company suggested the facility was a great opportunity to serve an extremely tight EPR market. Construction will begin next year, with the plant expected to start up in 2013. Shandong Yuhuang is searching for another firm to jointly fund the facility, which will cost over yuan (CNY) 700m ($108m).
11: NANTONG, CHINA
Germany’s LANXESS and Taiwan’s TSRC are expected to invest $50m (€40m) in the construction of their joint venture 30,000 tonne/year acrylonitrile-butadiene rubber (NBR) plant at Nantong in Eastern China. The 50:50 joint venture – LANXESS-TSRC (Nantong) Chemical Industrial – is expected to start up in the first half of 2012.
12: JURONG ISLAND, SINGAPORE
Germany-based LANXESS says its €400m ($579m) butyl plant in Jurong Island, Singapore, is scheduled to come on stream in the first quarter of 2013 and is the company’s largest-ever single investment. LANXESS is expecting its new 100,000 tonne/year butyl rubber plant in Singapore to be mechanically complete by 2012. Site infrastructure will be finished by June next year, while the olefins plant that will supply raw materials to the facility will be completed by August 2012. The butyl unit will come on stream in two parts: polymerization and finishing is expected to be completed by September 2012 and the halo butyl unit by October.
13: KOLKATA, INDIA
Germany’s Wacker Chemie has commissioned a new silicone rubber compounding plant at its joint venture site Wacker Metroark Chemicals near Kolkata, India. Several million euros is being invested in the facility, which will be capable of producing a few thousand tonnes of silicone compounds annually. These will be used in India’s electronics, automotive and medium-to-high voltage insulator markets.
14: PANIPAT, INDIA
India’s first large-scale styrene butadiene rubber (SBR) plant will be built at Panipat by Indian Synthetic Rubber – a joint venture among IndianOil Taiwan’s TSRC and Japan’s Marubeni. An estimated $200m (€142m) is being spent on the 120,000 tonne/year SBR plant, which is scheduled for completion in 2013.
Saturday, July 30, 2011
Thursday, July 28, 2011
RBI rate hike may impact rubber prices, say traders
RBI rate hike may impact rubber prices, say traders
July 27, 2011
KOCHI The Reserve Bank of India’s (RBI) decision to hike interest rates on its short term lending (repo) and borrowing (reverse repo) rates by 50 basis points may bring down prices of natural rubber in Kerala, according to traders.
Kerala accounts for 90 per cent of the natural rubber production in the country and the rubber cultivators in the state, who are already nursing fears of an imminent price fall owing to the government decision, may suffer further damage, traders said.
The RBI raised its lending and borrowing rates to 8 per cent and 7 per cent respectively to fight inflation.
The interest rates on automobile loans is expected move up in tune with the RBI rates hike, which may result in weakening of vehicles demand, said N Radhakrishan, advisor, Cochin Rubber Merchants’ Association.
The sluggish growth in auto sales will impact tyre industry, which accounts for 65 per cent of natural rubber demand in the country, he added.
The benchmark RSS-4 variety in spot markets of Kochi and Kottayam was at Rs210 per kg on Tuesday compared with Rs214 last Tuesday.
The peak season for rubber production, expected to begin from August 15, may also keep the overall sentiment subdued for the industry, traders said.
Tyre makers will wait for rise in supply with production hitting peak levels, they added.
A section of dealers, however, said the prices may not see any decline immediately as producers would have to hold back stocks to limit any sharp fall.
The overall trend in key Asian markets like Tokyo Commodity Exchange and Bangkok may also impact sentiments in Kerala, they said.
Import of natural rubber only option in near term
July 26, 2011
The raw material component of tyre industry estimated to be around R30,000 crore accounts for 70% of total cost of production. The industry has been pleading for increasing the availability of natural rubber, the key raw material, in the country to meet the rising demand and has recently contemplating acquiring rubber plantations abroad. Neeraj Kanwar Chairman, Automotive Tyre Manufacturers Association (ATMA) spoke to FE’s Sandip Das on various issues impacting the industry.
Why is the tyre industry looking for rubber plantations abroad when India is amongst the leading rubber producers in the world?
About three years ago, natural rubber production and consumption were matching. India has been the fourth largest producer and consumer of natural rubber in the world. Over the last three years, however, the consumption has grown at a much faster pace than production.
While India continues to be the fourth largest producer of rubber, it ranks second in consumption just after China. Growth in automobile sector and better road infrastructure has led to an exponential rise in demand for tyres which in turn has heightened the need for natural rubber by the industry.
However, the domestic demand-supply gap in natural rubber is widening. As a long-term measure, therefore, the industry is looking for acquiring rubber plantations abroad to secure future raw material needs like China.
While the plantations are a long term measure, what are the short term options for the industry?
The industry has been importing natural rubber to bridge the deficit between production and consumption as a short-term measure. While imports are inevitable, they represent an expensive option. A hefty 20% duty was imposed on import of natural rubber.
From 1st April, the Government has put a cap of R20 per kg of import which is a relief but domestic production being inadequate, we have asked for duty free import of rubber to the extent of domestic deficit which in the current year is likely to be in the range of 2 lakh tonne.
What are the implications if natural rubber import issue is not addressed urgently?
We consider rubber growers as a vital link in the value chain. But the current business realities call for a relook at the production and consumption imperatives.
In the last four years, natural rubber production has increased by only 1%.
On the other hand, its consumption has increased by around 16% leading to a wide gap. While plantations abroad will help bridge the gap as a long term measure, import is the only option in the near term.
However, costly imports will make the industry uncompetitive and the import of finished products especially tyres will take place denying value addition within the country.
Duty free import to the extent of domestic deficit should be seen in this backdrop.
The imports should not be seen as a dampener for domestic prices since it has been seen that in the years when maximum imports have happened, the domestic prices have also ruled higher.
People say that harping on raw material issue is only a ploy to increase prices. What are your views on this?
If you look at the average price of natural rubber in 2009-10 and 2010-11, there has been an increase of more than 100%. The prices of synthetic rubbers like PBR and SBR also have gone up in similar proportions.
In fact, in view of competition, the industry has not been able to pass on the increased cost of production to the consumers leading to a tight squeeze on profitability.
The ratio of net profit to net sales for the industry which was around 8% in 2009-10 has dwindled to less than 3% in 2010-11.
If the partial increase in cost of raw materials is not passed on to the consumers, the industry will be in losses.
Industry has already lined up investment programme of R15000 crore over the next 3-4 years to serve the rising demand from a growing economy.
Tokyo futures at 3-month high, may rise further (July 27)
July 27, 2011
BANGKOK, July 27 (Reuters) – Tokyo rubber futures rose 2.3 percent to a three-month high on Wednesday as concern about the U.S. debt stalemate encouraged investors and funds to take speculative buying in commodity futures, dealers said.
The benchmark rubber contract on the Tokyo Commodity Exchange (TOCOM) <0#JRU:> for January 2012 delivery rose 8.4 yen to settle at 396.0 yen ($5.1) per kg. It rose 2.3 percent to a high of 396.0 yen, the highest since April 27.
Dealers said TOCOM was expected to rise further on Thursday to test resistance at 400 yen.
However, the most active rubber contract on the Shanghai futures exchange for January delivery dropped 60 yuan to finish at 36,280 yuan ($5,632) per tonne.
“Rubber rose in line with other commodities. There was speculative buying in both grains and metal futures. Investment funds also continued to buy rubber as well,” said a Japanese dealer.
Commodities rose broadly on Tuesday, with copper and corn outperforming the pack, as fear of a U.S. credit default sank the dollar and investors sought assets that could preserve value.
Oil slipped on Wednesday, staying at $99.13 a barrel by 0713 GMT as worries about U.S. debt dominated the markets.
The dollar fell to a fresh record low versus the Swiss franc, with the U.S. currency under broad pressure on worries over the prospect of a U.S. debt default, pushing investors towards the perceived safe haven of the franc.
($1 = 78.070 Japanese Yen)
($1 = 6.441 Chinese Yuan)
Sheet rubber saps on buyer resistance
KOTTAYAM, JULY 27:
Physical rubber prices continued to remain subdued on Wednesday.
While prices were already under pressure from increasing domestic production, higher stocks and imports, the hike in short-term interest rates by 50 basis points raised further concerns over the demand for the commodity as it will also affect automobile sales.
NO SELLING PRESSURE
There was no panic selling in the market and prices slipped mainly on buyer resistance.
Sheet rubber dropped to Rs. 209 (209.50) a kg, as reported by the traders. The grade moved down to Rs 209.50 (210) a kg both at Kottayam and Kochi, according to the Rubber Board.
FUTURES WEAKEN
RSS 4 weakened with the August series falling to Rs 207.36 (209.15), September to Rs 206.65 (208.78), October to Rs 206.50 (208.30), November to Rs 207.01 (208.50), December to Rs 208.40 (209.00) and January to Rs 209.99 (210.10) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 (spot) improved to Rs 217.82 (214.96) a kg at Bangkok. The August futures increased to ¥386.8 (Rs. 219) from ¥ 380.5 a kg during the day session but then slipped to ¥ 386.4 (Rs. 218.78) in the night session on the Tokyo Commodity Exchange.
Spot rubber rates (Rs/kg) were: RSS-4: 209 (209.50); RSS-5: 206 (207); Ungraded: 200 (202); ISNR 20: 208 (208); and Latex 60%: 136.50 (137).
July 27, 2011
KOCHI The Reserve Bank of India’s (RBI) decision to hike interest rates on its short term lending (repo) and borrowing (reverse repo) rates by 50 basis points may bring down prices of natural rubber in Kerala, according to traders.
Kerala accounts for 90 per cent of the natural rubber production in the country and the rubber cultivators in the state, who are already nursing fears of an imminent price fall owing to the government decision, may suffer further damage, traders said.
The RBI raised its lending and borrowing rates to 8 per cent and 7 per cent respectively to fight inflation.
The interest rates on automobile loans is expected move up in tune with the RBI rates hike, which may result in weakening of vehicles demand, said N Radhakrishan, advisor, Cochin Rubber Merchants’ Association.
The sluggish growth in auto sales will impact tyre industry, which accounts for 65 per cent of natural rubber demand in the country, he added.
The benchmark RSS-4 variety in spot markets of Kochi and Kottayam was at Rs210 per kg on Tuesday compared with Rs214 last Tuesday.
The peak season for rubber production, expected to begin from August 15, may also keep the overall sentiment subdued for the industry, traders said.
Tyre makers will wait for rise in supply with production hitting peak levels, they added.
A section of dealers, however, said the prices may not see any decline immediately as producers would have to hold back stocks to limit any sharp fall.
The overall trend in key Asian markets like Tokyo Commodity Exchange and Bangkok may also impact sentiments in Kerala, they said.
Import of natural rubber only option in near term
July 26, 2011
The raw material component of tyre industry estimated to be around R30,000 crore accounts for 70% of total cost of production. The industry has been pleading for increasing the availability of natural rubber, the key raw material, in the country to meet the rising demand and has recently contemplating acquiring rubber plantations abroad. Neeraj Kanwar Chairman, Automotive Tyre Manufacturers Association (ATMA) spoke to FE’s Sandip Das on various issues impacting the industry.
Why is the tyre industry looking for rubber plantations abroad when India is amongst the leading rubber producers in the world?
About three years ago, natural rubber production and consumption were matching. India has been the fourth largest producer and consumer of natural rubber in the world. Over the last three years, however, the consumption has grown at a much faster pace than production.
While India continues to be the fourth largest producer of rubber, it ranks second in consumption just after China. Growth in automobile sector and better road infrastructure has led to an exponential rise in demand for tyres which in turn has heightened the need for natural rubber by the industry.
However, the domestic demand-supply gap in natural rubber is widening. As a long-term measure, therefore, the industry is looking for acquiring rubber plantations abroad to secure future raw material needs like China.
While the plantations are a long term measure, what are the short term options for the industry?
The industry has been importing natural rubber to bridge the deficit between production and consumption as a short-term measure. While imports are inevitable, they represent an expensive option. A hefty 20% duty was imposed on import of natural rubber.
From 1st April, the Government has put a cap of R20 per kg of import which is a relief but domestic production being inadequate, we have asked for duty free import of rubber to the extent of domestic deficit which in the current year is likely to be in the range of 2 lakh tonne.
What are the implications if natural rubber import issue is not addressed urgently?
We consider rubber growers as a vital link in the value chain. But the current business realities call for a relook at the production and consumption imperatives.
In the last four years, natural rubber production has increased by only 1%.
On the other hand, its consumption has increased by around 16% leading to a wide gap. While plantations abroad will help bridge the gap as a long term measure, import is the only option in the near term.
However, costly imports will make the industry uncompetitive and the import of finished products especially tyres will take place denying value addition within the country.
Duty free import to the extent of domestic deficit should be seen in this backdrop.
The imports should not be seen as a dampener for domestic prices since it has been seen that in the years when maximum imports have happened, the domestic prices have also ruled higher.
People say that harping on raw material issue is only a ploy to increase prices. What are your views on this?
If you look at the average price of natural rubber in 2009-10 and 2010-11, there has been an increase of more than 100%. The prices of synthetic rubbers like PBR and SBR also have gone up in similar proportions.
In fact, in view of competition, the industry has not been able to pass on the increased cost of production to the consumers leading to a tight squeeze on profitability.
The ratio of net profit to net sales for the industry which was around 8% in 2009-10 has dwindled to less than 3% in 2010-11.
If the partial increase in cost of raw materials is not passed on to the consumers, the industry will be in losses.
Industry has already lined up investment programme of R15000 crore over the next 3-4 years to serve the rising demand from a growing economy.
Tokyo futures at 3-month high, may rise further (July 27)
July 27, 2011
BANGKOK, July 27 (Reuters) – Tokyo rubber futures rose 2.3 percent to a three-month high on Wednesday as concern about the U.S. debt stalemate encouraged investors and funds to take speculative buying in commodity futures, dealers said.
The benchmark rubber contract on the Tokyo Commodity Exchange (TOCOM) <0#JRU:> for January 2012 delivery rose 8.4 yen to settle at 396.0 yen ($5.1) per kg. It rose 2.3 percent to a high of 396.0 yen, the highest since April 27.
Dealers said TOCOM was expected to rise further on Thursday to test resistance at 400 yen.
However, the most active rubber contract on the Shanghai futures exchange for January delivery dropped 60 yuan to finish at 36,280 yuan ($5,632) per tonne.
“Rubber rose in line with other commodities. There was speculative buying in both grains and metal futures. Investment funds also continued to buy rubber as well,” said a Japanese dealer.
Commodities rose broadly on Tuesday, with copper and corn outperforming the pack, as fear of a U.S. credit default sank the dollar and investors sought assets that could preserve value.
Oil slipped on Wednesday, staying at $99.13 a barrel by 0713 GMT as worries about U.S. debt dominated the markets.
The dollar fell to a fresh record low versus the Swiss franc, with the U.S. currency under broad pressure on worries over the prospect of a U.S. debt default, pushing investors towards the perceived safe haven of the franc.
($1 = 78.070 Japanese Yen)
($1 = 6.441 Chinese Yuan)
Sheet rubber saps on buyer resistance
KOTTAYAM, JULY 27:
Physical rubber prices continued to remain subdued on Wednesday.
While prices were already under pressure from increasing domestic production, higher stocks and imports, the hike in short-term interest rates by 50 basis points raised further concerns over the demand for the commodity as it will also affect automobile sales.
NO SELLING PRESSURE
There was no panic selling in the market and prices slipped mainly on buyer resistance.
Sheet rubber dropped to Rs. 209 (209.50) a kg, as reported by the traders. The grade moved down to Rs 209.50 (210) a kg both at Kottayam and Kochi, according to the Rubber Board.
FUTURES WEAKEN
RSS 4 weakened with the August series falling to Rs 207.36 (209.15), September to Rs 206.65 (208.78), October to Rs 206.50 (208.30), November to Rs 207.01 (208.50), December to Rs 208.40 (209.00) and January to Rs 209.99 (210.10) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 (spot) improved to Rs 217.82 (214.96) a kg at Bangkok. The August futures increased to ¥386.8 (Rs. 219) from ¥ 380.5 a kg during the day session but then slipped to ¥ 386.4 (Rs. 218.78) in the night session on the Tokyo Commodity Exchange.
Spot rubber rates (Rs/kg) were: RSS-4: 209 (209.50); RSS-5: 206 (207); Ungraded: 200 (202); ISNR 20: 208 (208); and Latex 60%: 136.50 (137).
Wednesday, July 27, 2011
Malaysia’s Rubber Product Exports To Hit RM14.4 Billion In 2011
Malaysia’s Rubber Product Exports To Hit RM14.4 Billion In 2011
July 26, 2011
KUALA LUMPUR, July 26 (Bernama) — Malaysia’s exports of rubber products are likely to increase by about 11 per cent or RM2 billion to RM14.4 billion this year from RM12.96 billion in 2010 due to higher prices and output.
Deputy Plantation Industries and Commodities Minister Datuk G. Palanivel said production for the first six months of 2011 rose to 480,000 tonnes from 450,000 tonnes during the same period last year.
”It is estimated that by 2020, the export revenue derived from the integrated rubber industry will reach more than RM98 billion,” he told reporters after launching the International Rubber Economic Conference 2011 here Tuesday.
He said export earnings had increased by 36 per cent to RM34 billion in 2010 from RM25 billion in 2009 due to continued firm regional demand and stronger natural rubber prices.
Present at the press conference were Malaysian Rubber Board (MRB) Chairman Datuk Wira Ahmad Hamzah and Director-General Datuk Dr Salmiah Ahmad.
Palanivel said demand for natural rubber was estimated to grow at a modest pace this year at 3.8 per cent to 11.149 million tonnes due to anticipation of slower growth of the global economy.
He said under the National Key Economic Area (NKEA), it was projected that the Malaysian rubber industry would contribute RM52.9 billion to Gross National Income by 2020 compared to RM20 billion last year.
To meet the strong demand for the commodity, Palanivel said the government wanted to increase the rubber yield per hectare with research and development via MRB.
Under the NKEA, he said, four entry points projects had been identified for implementation which include maintaining the rubber tappable area of one million hectares while increasing yield improvement to two tonnes per hectare by 2020.
Meanwhile, Dr Salmiah said rubber prices should stabilise around RM13.50 per kg.
Gaining traction: Rising rubber costs give used-tire market a boost in popularity
July 26, 2011
Rising rubber costs have set the used-tire market rolling.
As the price of new tires has risen alongside increasing material costs, used-tire retailers have gained popularity among customers not ready to drop hundreds of dollars on a new set of wheels.
“Especially in a bad economy, it kind of makes sense,” said Dan Zielinski, a spokesman for the Washington-based Rubber Manufacturers Association. “A new set of tires is going to cost you several hundred dollars; there’s no two ways about it. I don’t think anyone enjoys the process of sinking a lot of money into their car.”
High tire prices reflect the fact that natural rubber, petroleum and energy, the primary components of tires, have all spiked over the last few years, Kevin Rohlwing, senior vice president of training at the Tire Industry Association in Bowie, Md., said in a Monday email.
Natural rubber, which went for 75 cents a pound in 2009, soared to nearly $3 a pound last year, Rohlwing said. It has since fallen back to $2.28 a pound.
Used tires are still a relatively small slice of the overall tire market. About 33 million used tires were in the market in 2009, according to the latest figures available from the Rubber Manufacturers Association, compared with about 220 million replacement tires sold new.
Tokyo futures slip as US debt deadlock continues (July 26)
July 26, 2011
TOKYO, July 26 (Reuters) – Key Tokyo rubber futures fell on Tuesday, pulled down by the yen’s strength against the dollar and lower oil prices, while the U.S. debt crisis kept investors wary about risky assets and the global economy.
FUNDAMENTALS
* The key Tokyo Commodity Exchange rubber contract for January delivery <0#2JRU:>, which debuted on Tuesday, traded at 381.5 yen per kg as of 0020 GMT, after opening at 383.8 yen.
* The previous benchmark, for delivery in December, was down 2.3 yen at 379.6 yen.
* The most active Shanghai rubber contract for January delivery closed on Monday at 35,690 yuan ($5,537) per tonne, down from Friday’s 36,110 yuan. Volume fell to 584,164 lots from Friday’s 708,164 lots.
* The U.S. dollar slightly recovered after falling as low as 78.055 yen, its weakest since mid-March. The U.S. unit remained on the defensive in early Asia-Pacific having hit record lows on the safe-haven Swiss franc as the market awaited the latest attempt by President Barack Obama to break the deadlock on debt talks.
* U.S. crude futures fell below $99 a barrel on Tuesday as investors avoided riskier assets due to U.S. lawmakers’ deadlock over duelling debt plans, raising the risk of a credit ratings downgrade and national default.
* For the top stories in the rubber market and other news, click , or
MARKET NEWS
* Japan’s benchmark Nikkei average opened up 0.3 percent at 10,078.48 on Tuesday. The market is expected to trade narrowly, with positive earning results from Canon and other firms likely to lend support but concerns about the U.S. deadlock seen sapping trading appetite.
* Nissan Motor Co plans to double automobile production in China, its biggest market, to more than 2 million units a year by the end of 2015 as it shifts its focus to emerging countries, Japanese business daily Nikkei reported.
* Strong U.S. sales for Chrysler and growth in Brazil will help offset a weak European market for Fiat SpA , combined financial results are set to show on Tuesday as the two car makers move closer towards a full merger.
DATA EVENTS
* The following data is expected on Tuesday: – 1145 U.S. ICSC chain stores yy Weekly – 1300 U.S. CaseShiller 20 mm nsa May – 1300 U.S. CaseShiller 20 yy May – 1400 U.S. New home sales chg mm Jun – 1400 U.S. New home sales-units mm Jun – 1400 U.S. Consumer confidence Jul – 2030 U.S. API weekly crude stocks Jul 22 – 2030 U.S. API weekly dist. stocks Jul 22 – 2030 U.S. API weekly gasoline stk Jul 22 – 2300 S.Korea GDP growth yy Advance Apr 2011.
Sri Lanka expands acreage under rubber
July 26, 2011
Natural rubber is facing a bright future with the price of petroleum-based synthetic rubberincreasing rapidly. Therefore Sri Lanka would expand its acreage under rubber by planting 5,000 hectares in Monaragala,
Plantation Industries Minister Mahinder Samarasinghe announced recently.
Addressing the 92nd Annual General Meeting of the Colombo Rubber Traders’ Association as the chief guest the minister said it would increase to 10,000 hectares as the demand grew for natural rubber.
He said plantation trials were also being conducted by the Rubber Research Institute in the Jaffna district and other northern areas.
Minister Samarasinghe said the present estate management lease agreement would lapse in 35 years and he posed an open ended question; would it be that the plantations would revert to the people of this country or continue to be sustained in its present form? He brought to bear the intensity of small holders who had contributed significantly circumventing all odds and they were significant partners in the progress of the sector.
Exports of value added products are now in the region of 63 million SLR (US$576,000), and growing with 2010 being a record year.
He said 1.5 billion SLR was cost of fertilizer for totality of rubber holdings. It was therefore imperative that simultaneous increase of production was essential if the rubber industry was to progress.
The subsidy was increased and plantation companies too were subsidized for use of panel guards to intensify increased production.
Colombo Rubber Traders’ Association Chairman M.S.Rahim said that planters and regional plantation companies had to be credited with high standards they maintained.
He said product standards plus their sustained production drive had sequentially resulted in Rubber being an important plantation crop which had proved its worth and its impact on the economy. Production had increased 12%, but the small holder sector, of about 125,000 cultivators contributed substantially to boost production levels which were about 153,000 tonnes annually.
Latex crepe contributed to natural rubber exports, but value added products gaining in exports had also contributed to plus factors to enhance importance of rubber contributing to export inventories surpassing all past records. Rahim said in summing up 2010 as a good year.
Safeguard duty on key cemical to impact rubber industry
July 26, 2011
NEW DELHI: Margins oftyre and rubber industry will take a hit after India has deciding to impose steep safeguard duties on a key chemical used in processing despite protests from the European Union and the US. Thesafeguard duty on the chemical (PX-13 ) is aimed at protecting the domestic industry against a surge in imports causing losses. It will be levied at 30% of the imported value in the first year and 25% in the second year, as per a notification. India is largest producer of the chemical.
“The decision to impose safeguard duty was taken as there has been a significant increase in imports despite imposition of anti-dumping duties ,” a government official told ET. The landed price of imports is lower than cost of production and selling price of domestic industry resulting in price suppression,” he added. Certain companies from the EU and China, which have already been penalised with anti-dumping duties for selling in India at prices lower than that prevailing in their domestic markets, will have to pay the difference between the two levies, a government official explained.
NOCIL, in its complaint filed to the director general of safeguards, had stated that given the surge in imports , the domestic industry may not find market for additional capacities that are coming up. DG safeguards conducts safeguard investigations and recommends duties which is ultimately notified by the finance ministry. The user industry, which includes tyre manufacturers like JK Industries ,CEAT,Apollo Tyres, Birla Tyre,MRF and Metro tyres, would now have to pay a higher import duty on the chemical.
The Automotive Tyre Manufactuer’s Association is apprehensive that the duty may affect input prices in the future . “Once the domestic industry builds the additional capacity, the user industry will entirely be at the mercy of domestic producers which will make the Indian tyre industry uncompetitive ,” the association said in a representation to DG safeguards.
Import of natural rubber only option in near term
July 26, 2011
The raw material component of tyre industry estimated to be around R30,000 crore accounts for 70% of total cost of production. The industry has been pleading for increasing the availability of natural rubber, the key raw material, in the country to meet the rising demand and has recently contemplating acquiring rubber plantations abroad. Neeraj Kanwar Chairman, Automotive Tyre Manufacturers Association (ATMA) spoke to FE’s Sandip Das on various issues impacting the industry.
Why is the tyre industry looking for rubber plantations abroad when India is amongst the leading rubber producers in the world?
About three years ago, natural rubber production and consumption were matching. India has been the fourth largest producer and consumer of natural rubber in the world. Over the last three years, however, the consumption has grown at a much faster pace than production.
While India continues to be the fourth largest producer of rubber, it ranks second in consumption just after China. Growth in automobile sector and better road infrastructure has led to an exponential rise in demand for tyres which in turn has heightened the need for natural rubber by the industry.
However, the domestic demand-supply gap in natural rubber is widening. As a long-term measure, therefore, the industry is looking for acquiring rubber plantations abroad to secure future raw material needs like China.
While the plantations are a long term measure, what are the short term options for the industry?
The industry has been importing natural rubber to bridge the deficit between production and consumption as a short-term measure. While imports are inevitable, they represent an expensive option. A hefty 20% duty was imposed on import of natural rubber.
From 1st April, the Government has put a cap of R20 per kg of import which is a relief but domestic production being inadequate, we have asked for duty free import of rubber to the extent of domestic deficit which in the current year is likely to be in the range of 2 lakh tonne.
What are the implications if natural rubber import issue is not addressed urgently?
We consider rubber growers as a vital link in the value chain. But the current business realities call for a relook at the production and consumption imperatives.
In the last four years, natural rubber production has increased by only 1%.
On the other hand, its consumption has increased by around 16% leading to a wide gap. While plantations abroad will help bridge the gap as a long term measure, import is the only option in the near term.
However, costly imports will make the industry uncompetitive and the import of finished products especially tyres will take place denying value addition within the country.
Duty free import to the extent of domestic deficit should be seen in this backdrop.
The imports should not be seen as a dampener for domestic prices since it has been seen that in the years when maximum imports have happened, the domestic prices have also ruled higher.
People say that harping on raw material issue is only a ploy to increase prices. What are your views on this?
If you look at the average price of natural rubber in 2009-10 and 2010-11, there has been an increase of more than 100%. The prices of synthetic rubbers like PBR and SBR also have gone up in similar proportions.
In fact, in view of competition, the industry has not been able to pass on the increased cost of production to the consumers leading to a tight squeeze on profitability.
The ratio of net profit to net sales for the industry which was around 8% in 2009-10 has dwindled to less than 3% in 2010-11.
If the partial increase in cost of raw materials is not passed on to the consumers, the industry will be in losses.
Industry has already lined up investment programme of R15000 crore over the next 3-4 years to serve the rising demand from a growing economy.
July 26, 2011
KUALA LUMPUR, July 26 (Bernama) — Malaysia’s exports of rubber products are likely to increase by about 11 per cent or RM2 billion to RM14.4 billion this year from RM12.96 billion in 2010 due to higher prices and output.
Deputy Plantation Industries and Commodities Minister Datuk G. Palanivel said production for the first six months of 2011 rose to 480,000 tonnes from 450,000 tonnes during the same period last year.
”It is estimated that by 2020, the export revenue derived from the integrated rubber industry will reach more than RM98 billion,” he told reporters after launching the International Rubber Economic Conference 2011 here Tuesday.
He said export earnings had increased by 36 per cent to RM34 billion in 2010 from RM25 billion in 2009 due to continued firm regional demand and stronger natural rubber prices.
Present at the press conference were Malaysian Rubber Board (MRB) Chairman Datuk Wira Ahmad Hamzah and Director-General Datuk Dr Salmiah Ahmad.
Palanivel said demand for natural rubber was estimated to grow at a modest pace this year at 3.8 per cent to 11.149 million tonnes due to anticipation of slower growth of the global economy.
He said under the National Key Economic Area (NKEA), it was projected that the Malaysian rubber industry would contribute RM52.9 billion to Gross National Income by 2020 compared to RM20 billion last year.
To meet the strong demand for the commodity, Palanivel said the government wanted to increase the rubber yield per hectare with research and development via MRB.
Under the NKEA, he said, four entry points projects had been identified for implementation which include maintaining the rubber tappable area of one million hectares while increasing yield improvement to two tonnes per hectare by 2020.
Meanwhile, Dr Salmiah said rubber prices should stabilise around RM13.50 per kg.
Gaining traction: Rising rubber costs give used-tire market a boost in popularity
July 26, 2011
Rising rubber costs have set the used-tire market rolling.
As the price of new tires has risen alongside increasing material costs, used-tire retailers have gained popularity among customers not ready to drop hundreds of dollars on a new set of wheels.
“Especially in a bad economy, it kind of makes sense,” said Dan Zielinski, a spokesman for the Washington-based Rubber Manufacturers Association. “A new set of tires is going to cost you several hundred dollars; there’s no two ways about it. I don’t think anyone enjoys the process of sinking a lot of money into their car.”
High tire prices reflect the fact that natural rubber, petroleum and energy, the primary components of tires, have all spiked over the last few years, Kevin Rohlwing, senior vice president of training at the Tire Industry Association in Bowie, Md., said in a Monday email.
Natural rubber, which went for 75 cents a pound in 2009, soared to nearly $3 a pound last year, Rohlwing said. It has since fallen back to $2.28 a pound.
Used tires are still a relatively small slice of the overall tire market. About 33 million used tires were in the market in 2009, according to the latest figures available from the Rubber Manufacturers Association, compared with about 220 million replacement tires sold new.
Tokyo futures slip as US debt deadlock continues (July 26)
July 26, 2011
TOKYO, July 26 (Reuters) – Key Tokyo rubber futures fell on Tuesday, pulled down by the yen’s strength against the dollar and lower oil prices, while the U.S. debt crisis kept investors wary about risky assets and the global economy.
FUNDAMENTALS
* The key Tokyo Commodity Exchange rubber contract for January delivery <0#2JRU:>, which debuted on Tuesday, traded at 381.5 yen per kg as of 0020 GMT, after opening at 383.8 yen.
* The previous benchmark, for delivery in December, was down 2.3 yen at 379.6 yen.
* The most active Shanghai rubber contract for January delivery closed on Monday at 35,690 yuan ($5,537) per tonne, down from Friday’s 36,110 yuan. Volume fell to 584,164 lots from Friday’s 708,164 lots.
* The U.S. dollar slightly recovered after falling as low as 78.055 yen, its weakest since mid-March. The U.S. unit remained on the defensive in early Asia-Pacific having hit record lows on the safe-haven Swiss franc as the market awaited the latest attempt by President Barack Obama to break the deadlock on debt talks.
* U.S. crude futures fell below $99 a barrel on Tuesday as investors avoided riskier assets due to U.S. lawmakers’ deadlock over duelling debt plans, raising the risk of a credit ratings downgrade and national default.
* For the top stories in the rubber market and other news, click , or
MARKET NEWS
* Japan’s benchmark Nikkei average opened up 0.3 percent at 10,078.48 on Tuesday. The market is expected to trade narrowly, with positive earning results from Canon and other firms likely to lend support but concerns about the U.S. deadlock seen sapping trading appetite.
* Nissan Motor Co plans to double automobile production in China, its biggest market, to more than 2 million units a year by the end of 2015 as it shifts its focus to emerging countries, Japanese business daily Nikkei reported.
* Strong U.S. sales for Chrysler and growth in Brazil will help offset a weak European market for Fiat SpA , combined financial results are set to show on Tuesday as the two car makers move closer towards a full merger.
DATA EVENTS
* The following data is expected on Tuesday: – 1145 U.S. ICSC chain stores yy Weekly – 1300 U.S. CaseShiller 20 mm nsa May – 1300 U.S. CaseShiller 20 yy May – 1400 U.S. New home sales chg mm Jun – 1400 U.S. New home sales-units mm Jun – 1400 U.S. Consumer confidence Jul – 2030 U.S. API weekly crude stocks Jul 22 – 2030 U.S. API weekly dist. stocks Jul 22 – 2030 U.S. API weekly gasoline stk Jul 22 – 2300 S.Korea GDP growth yy Advance Apr 2011.
Sri Lanka expands acreage under rubber
July 26, 2011
Natural rubber is facing a bright future with the price of petroleum-based synthetic rubberincreasing rapidly. Therefore Sri Lanka would expand its acreage under rubber by planting 5,000 hectares in Monaragala,
Plantation Industries Minister Mahinder Samarasinghe announced recently.
Addressing the 92nd Annual General Meeting of the Colombo Rubber Traders’ Association as the chief guest the minister said it would increase to 10,000 hectares as the demand grew for natural rubber.
He said plantation trials were also being conducted by the Rubber Research Institute in the Jaffna district and other northern areas.
Minister Samarasinghe said the present estate management lease agreement would lapse in 35 years and he posed an open ended question; would it be that the plantations would revert to the people of this country or continue to be sustained in its present form? He brought to bear the intensity of small holders who had contributed significantly circumventing all odds and they were significant partners in the progress of the sector.
Exports of value added products are now in the region of 63 million SLR (US$576,000), and growing with 2010 being a record year.
He said 1.5 billion SLR was cost of fertilizer for totality of rubber holdings. It was therefore imperative that simultaneous increase of production was essential if the rubber industry was to progress.
The subsidy was increased and plantation companies too were subsidized for use of panel guards to intensify increased production.
Colombo Rubber Traders’ Association Chairman M.S.Rahim said that planters and regional plantation companies had to be credited with high standards they maintained.
He said product standards plus their sustained production drive had sequentially resulted in Rubber being an important plantation crop which had proved its worth and its impact on the economy. Production had increased 12%, but the small holder sector, of about 125,000 cultivators contributed substantially to boost production levels which were about 153,000 tonnes annually.
Latex crepe contributed to natural rubber exports, but value added products gaining in exports had also contributed to plus factors to enhance importance of rubber contributing to export inventories surpassing all past records. Rahim said in summing up 2010 as a good year.
Safeguard duty on key cemical to impact rubber industry
July 26, 2011
NEW DELHI: Margins oftyre and rubber industry will take a hit after India has deciding to impose steep safeguard duties on a key chemical used in processing despite protests from the European Union and the US. Thesafeguard duty on the chemical (PX-13 ) is aimed at protecting the domestic industry against a surge in imports causing losses. It will be levied at 30% of the imported value in the first year and 25% in the second year, as per a notification. India is largest producer of the chemical.
“The decision to impose safeguard duty was taken as there has been a significant increase in imports despite imposition of anti-dumping duties ,” a government official told ET. The landed price of imports is lower than cost of production and selling price of domestic industry resulting in price suppression,” he added. Certain companies from the EU and China, which have already been penalised with anti-dumping duties for selling in India at prices lower than that prevailing in their domestic markets, will have to pay the difference between the two levies, a government official explained.
NOCIL, in its complaint filed to the director general of safeguards, had stated that given the surge in imports , the domestic industry may not find market for additional capacities that are coming up. DG safeguards conducts safeguard investigations and recommends duties which is ultimately notified by the finance ministry. The user industry, which includes tyre manufacturers like JK Industries ,CEAT,Apollo Tyres, Birla Tyre,MRF and Metro tyres, would now have to pay a higher import duty on the chemical.
The Automotive Tyre Manufactuer’s Association is apprehensive that the duty may affect input prices in the future . “Once the domestic industry builds the additional capacity, the user industry will entirely be at the mercy of domestic producers which will make the Indian tyre industry uncompetitive ,” the association said in a representation to DG safeguards.
Import of natural rubber only option in near term
July 26, 2011
The raw material component of tyre industry estimated to be around R30,000 crore accounts for 70% of total cost of production. The industry has been pleading for increasing the availability of natural rubber, the key raw material, in the country to meet the rising demand and has recently contemplating acquiring rubber plantations abroad. Neeraj Kanwar Chairman, Automotive Tyre Manufacturers Association (ATMA) spoke to FE’s Sandip Das on various issues impacting the industry.
Why is the tyre industry looking for rubber plantations abroad when India is amongst the leading rubber producers in the world?
About three years ago, natural rubber production and consumption were matching. India has been the fourth largest producer and consumer of natural rubber in the world. Over the last three years, however, the consumption has grown at a much faster pace than production.
While India continues to be the fourth largest producer of rubber, it ranks second in consumption just after China. Growth in automobile sector and better road infrastructure has led to an exponential rise in demand for tyres which in turn has heightened the need for natural rubber by the industry.
However, the domestic demand-supply gap in natural rubber is widening. As a long-term measure, therefore, the industry is looking for acquiring rubber plantations abroad to secure future raw material needs like China.
While the plantations are a long term measure, what are the short term options for the industry?
The industry has been importing natural rubber to bridge the deficit between production and consumption as a short-term measure. While imports are inevitable, they represent an expensive option. A hefty 20% duty was imposed on import of natural rubber.
From 1st April, the Government has put a cap of R20 per kg of import which is a relief but domestic production being inadequate, we have asked for duty free import of rubber to the extent of domestic deficit which in the current year is likely to be in the range of 2 lakh tonne.
What are the implications if natural rubber import issue is not addressed urgently?
We consider rubber growers as a vital link in the value chain. But the current business realities call for a relook at the production and consumption imperatives.
In the last four years, natural rubber production has increased by only 1%.
On the other hand, its consumption has increased by around 16% leading to a wide gap. While plantations abroad will help bridge the gap as a long term measure, import is the only option in the near term.
However, costly imports will make the industry uncompetitive and the import of finished products especially tyres will take place denying value addition within the country.
Duty free import to the extent of domestic deficit should be seen in this backdrop.
The imports should not be seen as a dampener for domestic prices since it has been seen that in the years when maximum imports have happened, the domestic prices have also ruled higher.
People say that harping on raw material issue is only a ploy to increase prices. What are your views on this?
If you look at the average price of natural rubber in 2009-10 and 2010-11, there has been an increase of more than 100%. The prices of synthetic rubbers like PBR and SBR also have gone up in similar proportions.
In fact, in view of competition, the industry has not been able to pass on the increased cost of production to the consumers leading to a tight squeeze on profitability.
The ratio of net profit to net sales for the industry which was around 8% in 2009-10 has dwindled to less than 3% in 2010-11.
If the partial increase in cost of raw materials is not passed on to the consumers, the industry will be in losses.
Industry has already lined up investment programme of R15000 crore over the next 3-4 years to serve the rising demand from a growing economy.
Tuesday, July 26, 2011
Tokyo futures rise but stronger yen limits gains (July 25)
Tokyo futures rise but stronger yen limits gains (July 25)
July 25, 2011
TOKYO, July 25 (Reuters) – Key Tokyo rubber futures rose on Monday, after the market ended above a key technical level last week and oil prices rose, but sentiment was weighed down by a stronger yen.
FUNDAMENTALS
* The key Tokyo Commodity Exchange rubber contract for December delivery <0#2JRU:> rose 2.9 yen or 0.8 percent to 384.0 yen per kg as of 0022 GMT.
* The front-month July contract will expire later in the session. The contract for January 2012 delivery will become the new benchmark from Tuesday.
* The most active Shanghai rubber contract for January delivery closed on Friday at 36,110 yuan ($5,597.061) per tonne, up from the previous day’s close of 35,965 yuan per tonne. Volume slipped to 708,164 lots from Thursday’s 736,124 lots.
* U.S. crude futures fell on Monday after settling at a six-week high on Friday, taking their cue from a decline in U.S. stock futures amid uncertainty over talks to avert an unprecedented U.S. default.
* The dollar slipped in early Asia-Pacific trade on Monday as investors looked for signs of progress to break the deadlock that will avert a U.S. debt default. The dollar fell to a four-month low of 78.10 yen in early trade. A stronger yen deflates yen-priced TOCOM futures prices and weighs on sentiment.
* For top stories on the rubber market and other news click , or
MARKET NEWS
* President Barack Obama and congressional leaders struggled on Sunday to break a partisan deadlock on a budget deal to avoid a U.S. debt default and reassure global markets, with no sign of a deal emerging.
* Suzuki Motor Corp could deepen its cooperation with Fiat amid a rift with German partner Volkswagen , a German magazine reported on Saturday.
* The Nikkei average snapped a three-day run of gains on Monday as a stronger yen dragged down exporters, while investors stayed on the sidelines ahead of a slew of earnings reports due later this week.
* U.S. stock index futures fell sharply on Sunday as failure so far by the government to strike a deal on the debt ceiling made the prospect of default, once considered an impossible outcome, more likely.
Malaysia: Rubber expected to trade lower this week
July 25, 2011
KUALA LUMPUR: MALAYSIAN rubber is expected to trade lower this week as the stronger ringgit weighs on prices.
“Overseas demand is expected to slow down due to the strengthening ringgit but tighter supply due to heavy rain in Thailand, a major producing country, may cushion the effect,” a dealer said.
The local market was also likely to be influenced by the commodity’s performance on regional markets as well as industrial data from major rubber consumer countries such as China, he added.
On a week-to-week basis, the Malaysian Rubber Board’s official physical noon price for tyre-grade SMR 20 declined 18.5 sen to 1,372.5 sen per kg from 1,354.0 sen, while latex-in-bulk rose 14.0 sen to 896.5 sen per kg from 882.5 sen. The unofficial closing price for tyre-grade SMR 20 gained 8.5 sen to 1,368.5 sen per kg from 1,360.0 sen, while latex-in-bulk added 5.0 sen to 892.5 sen per kg from 887.5 sen.
July 25, 2011
TOKYO, July 25 (Reuters) – Key Tokyo rubber futures rose on Monday, after the market ended above a key technical level last week and oil prices rose, but sentiment was weighed down by a stronger yen.
FUNDAMENTALS
* The key Tokyo Commodity Exchange rubber contract for December delivery <0#2JRU:> rose 2.9 yen or 0.8 percent to 384.0 yen per kg as of 0022 GMT.
* The front-month July contract will expire later in the session. The contract for January 2012 delivery will become the new benchmark from Tuesday.
* The most active Shanghai rubber contract for January delivery closed on Friday at 36,110 yuan ($5,597.061) per tonne, up from the previous day’s close of 35,965 yuan per tonne. Volume slipped to 708,164 lots from Thursday’s 736,124 lots.
* U.S. crude futures fell on Monday after settling at a six-week high on Friday, taking their cue from a decline in U.S. stock futures amid uncertainty over talks to avert an unprecedented U.S. default.
* The dollar slipped in early Asia-Pacific trade on Monday as investors looked for signs of progress to break the deadlock that will avert a U.S. debt default. The dollar fell to a four-month low of 78.10 yen in early trade. A stronger yen deflates yen-priced TOCOM futures prices and weighs on sentiment.
* For top stories on the rubber market and other news click , or
MARKET NEWS
* President Barack Obama and congressional leaders struggled on Sunday to break a partisan deadlock on a budget deal to avoid a U.S. debt default and reassure global markets, with no sign of a deal emerging.
* Suzuki Motor Corp could deepen its cooperation with Fiat amid a rift with German partner Volkswagen , a German magazine reported on Saturday.
* The Nikkei average snapped a three-day run of gains on Monday as a stronger yen dragged down exporters, while investors stayed on the sidelines ahead of a slew of earnings reports due later this week.
* U.S. stock index futures fell sharply on Sunday as failure so far by the government to strike a deal on the debt ceiling made the prospect of default, once considered an impossible outcome, more likely.
Malaysia: Rubber expected to trade lower this week
July 25, 2011
KUALA LUMPUR: MALAYSIAN rubber is expected to trade lower this week as the stronger ringgit weighs on prices.
“Overseas demand is expected to slow down due to the strengthening ringgit but tighter supply due to heavy rain in Thailand, a major producing country, may cushion the effect,” a dealer said.
The local market was also likely to be influenced by the commodity’s performance on regional markets as well as industrial data from major rubber consumer countries such as China, he added.
On a week-to-week basis, the Malaysian Rubber Board’s official physical noon price for tyre-grade SMR 20 declined 18.5 sen to 1,372.5 sen per kg from 1,354.0 sen, while latex-in-bulk rose 14.0 sen to 896.5 sen per kg from 882.5 sen. The unofficial closing price for tyre-grade SMR 20 gained 8.5 sen to 1,368.5 sen per kg from 1,360.0 sen, while latex-in-bulk added 5.0 sen to 892.5 sen per kg from 887.5 sen.
Monday, July 25, 2011
Rubber ruckus
Rubber ruckus
July 24, 2011
The surest way to balance rubber demand and supply is to allow free imports and exports, with the only regulating mechanism being the tariff rate.
Trade and tariff policies relating to rubber have always tested and stretched the resilience of market participants. The commodity courts controversy simply because of the expectations, often unrealistic, of those at the extremes of the commodity spectrum — primary producers and industrial consumers. And, more often than not, the official response to developing market conditions has been of little help in bridging the expectations gap. While growers, as is their wont, want to obtain the most remunerative prices, consumers want to source the produce at the lowest possible cost; and there lies the rub. There is no genuine price discovery either. Derivative or futures trading has been of little help because of the role of speculative capital, with prices on the bourses having hardly any bearing on demand-supply fundamentals.
So, the growers’ recent consternation over the Government’s decision to permit import of 40,000 tonnes of rubber at 7.5 per cent Customs duty is nothing new. There is no challenge to the Rubber Board’s forecast of a supply shortfall of 75,000 tonnes for 2011-12. The stocks, of about 2.5 lakh tonnes, are equal to three months consumption. Any reduction in inventory without adequate and timely replenishment is a sure recipe for a major price spurt, not only in the domestic market but also globally. This is best avoided because the country would then be at the mercy of supplier countries which will, no doubt, push prices up.
In a rapidly growing economy, rubber consumption is sure to log robust expansion. Unless rubber output growth equals demand growth, supply shortfall and, in turn, imports are inevitable. So, growers, in their long-term interest, must work towards consistently expanding production to levels that make imports unnecessary. There are many, including State-level politicians, who shed tears for small growers and want to be seen protecting their interests. The moot question is whether the former have done anything at all to build capacity among the small growers to face competition from imports. If anything, and regrettably, small growers have remained small. It is essential that measures to make rubber production globally competitive are initiated and implemented effectively. Small growers ought to be an integral part of this strategy. To ensure a stable long-term trade policy, there should be no restriction on the volume of rubber imports and exports. The surest way to balance the market is to allow free imports and exports to coexist. The only instrument the government ought to use to regulate foreign trade in rubber is the tariff mechanism — raise the rate of Customs duty to restrict imports or lower it to encourage larger inflows.
Spot rubber rules steady
July 24, 2011
KOTTAYAM, JULY 23:
Spot rubber closed unchanged on Saturday. Overall volumes were low.
In futures, the August series closed at Rs 210.51 (210.75), September at Rs 210.85 (210.43), October at Rs 210.60 (210.24) and January at Rs 212.45 (212.50) a kg for RSS 4 on the National Multi Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 210 (210); RSS-5: 208 (208); ungraded: 205 (205); ISNR 20: 208 (208) and latex 60 per cent: 138 (138).
Overseas demand for rubber to slow
July 24, 2011
Malaysian rubber is expected to trade lower next week as the stronger ringgit weighs on prices.
“Overseas demand is expected to slow down due to the strengthening ringgit but tighter supply due to heavy rain in Thailand, a major producing country, may cushion the effect,” a dealer said.
The local market was also likely to be influenced by the commodity’s performance on regional markets as well as industrial data from major rubber consumer countries such as China, he added.
On a week-to-week basis, the Malaysian Rubber Board’s official physical noon price for tyre-grade SMR 20 declined 18.5 sen to 1,372.5 sen per kg from 1,354.0 sen, while latex-in-bulk rose 14.0 sen to 896.5 sen per kg from 882.5 sen.
The unofficial closing price for tyre-grade SMR 20 gained 8.5 sen to 1,368.5 sen per kg from 1,360.0 sen, while latex-in-bulk added 5.0 sen to 892.5 sen per kg from 887.5 sen. —
July 24, 2011
The surest way to balance rubber demand and supply is to allow free imports and exports, with the only regulating mechanism being the tariff rate.
Trade and tariff policies relating to rubber have always tested and stretched the resilience of market participants. The commodity courts controversy simply because of the expectations, often unrealistic, of those at the extremes of the commodity spectrum — primary producers and industrial consumers. And, more often than not, the official response to developing market conditions has been of little help in bridging the expectations gap. While growers, as is their wont, want to obtain the most remunerative prices, consumers want to source the produce at the lowest possible cost; and there lies the rub. There is no genuine price discovery either. Derivative or futures trading has been of little help because of the role of speculative capital, with prices on the bourses having hardly any bearing on demand-supply fundamentals.
So, the growers’ recent consternation over the Government’s decision to permit import of 40,000 tonnes of rubber at 7.5 per cent Customs duty is nothing new. There is no challenge to the Rubber Board’s forecast of a supply shortfall of 75,000 tonnes for 2011-12. The stocks, of about 2.5 lakh tonnes, are equal to three months consumption. Any reduction in inventory without adequate and timely replenishment is a sure recipe for a major price spurt, not only in the domestic market but also globally. This is best avoided because the country would then be at the mercy of supplier countries which will, no doubt, push prices up.
In a rapidly growing economy, rubber consumption is sure to log robust expansion. Unless rubber output growth equals demand growth, supply shortfall and, in turn, imports are inevitable. So, growers, in their long-term interest, must work towards consistently expanding production to levels that make imports unnecessary. There are many, including State-level politicians, who shed tears for small growers and want to be seen protecting their interests. The moot question is whether the former have done anything at all to build capacity among the small growers to face competition from imports. If anything, and regrettably, small growers have remained small. It is essential that measures to make rubber production globally competitive are initiated and implemented effectively. Small growers ought to be an integral part of this strategy. To ensure a stable long-term trade policy, there should be no restriction on the volume of rubber imports and exports. The surest way to balance the market is to allow free imports and exports to coexist. The only instrument the government ought to use to regulate foreign trade in rubber is the tariff mechanism — raise the rate of Customs duty to restrict imports or lower it to encourage larger inflows.
Spot rubber rules steady
July 24, 2011
KOTTAYAM, JULY 23:
Spot rubber closed unchanged on Saturday. Overall volumes were low.
In futures, the August series closed at Rs 210.51 (210.75), September at Rs 210.85 (210.43), October at Rs 210.60 (210.24) and January at Rs 212.45 (212.50) a kg for RSS 4 on the National Multi Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 210 (210); RSS-5: 208 (208); ungraded: 205 (205); ISNR 20: 208 (208) and latex 60 per cent: 138 (138).
Overseas demand for rubber to slow
July 24, 2011
Malaysian rubber is expected to trade lower next week as the stronger ringgit weighs on prices.
“Overseas demand is expected to slow down due to the strengthening ringgit but tighter supply due to heavy rain in Thailand, a major producing country, may cushion the effect,” a dealer said.
The local market was also likely to be influenced by the commodity’s performance on regional markets as well as industrial data from major rubber consumer countries such as China, he added.
On a week-to-week basis, the Malaysian Rubber Board’s official physical noon price for tyre-grade SMR 20 declined 18.5 sen to 1,372.5 sen per kg from 1,354.0 sen, while latex-in-bulk rose 14.0 sen to 896.5 sen per kg from 882.5 sen.
The unofficial closing price for tyre-grade SMR 20 gained 8.5 sen to 1,368.5 sen per kg from 1,360.0 sen, while latex-in-bulk added 5.0 sen to 892.5 sen per kg from 887.5 sen. —
Friday, July 22, 2011
Rubber market on July 21: Spot rubber declines further on buyer resistance
Rubber market on July 21: Spot rubber declines further on buyer resistance
July 21, 2011
KOTTAYAM, JULY 21:
Domestic rubber prices remained under pressure on Thursday. In the spot, prices weakened further on buyer resistance. Declines in the Japanese futures and another weak closing on the National Multi Commodity Exchange weighed on the market, as most of the traders stayed back letting the prices to seek further lows. The news on imports continued to cast its shadow over the sentiments. Among other reports, the key TOCOM rubber futures surrendered on profit taking ahead of the emergency European Summit in Brussels after hitting a six week high on Wednesday.
Sheet rubber dropped to Rs 213 (214) a kg, according to traders. The grade moved down to Rs 213.50 (214.50) a kg both at Kottayam and Kochi, as quoted by the Rubber Board.
The August series weakened to Rs 208.50 (213.01), September to Rs 208.41 (211.92), October to Rs 209.50 (212.30), November to Rs 210.55 (214), December to Rs 211 (214) and January to Rs 210.50 (216.71) a kg for RSS 4 on the NMCE.
The July futures declined to ¥377.6 (Rs 213.08) from ¥381.9 a kg during the day session and then to ¥377.2 (Rs 212.85) in the night session on the Tokyo Commodity Exchange. RSS 3 (spot) slipped to Rs 216.14 (216.30) a kg at Bangkok.
Spot rates were (Rs/kg): RSS-4: 213 (214); RSS-5: 210 (211); ungraded: 206 (208); ISNR 20: 210 (211) and latex 60 per cent: 139 (139).
Rubber prices not expected to fall despite imports at lower duty
July 20, 2011
KOCHI, JULY 20:
The announcement that 40,000 tonnes of natural rubber can be imported at the concessional duty of 7.5 per cent has created a flutter in the market and apprehension in the minds of rubber farmers. What has created greater consternation in the minds of the farming community has been the speed with which the announcement was made.
The announcement came in the backdrop of a short spell of just two weeks when global rubber prices edged lower than domestic prices.
However, Mr R Sanjith, Head of Commodity, United Planters Association of Southern India (UPASI), said that for six months domestic prices were consistently lower than international prices. Between January and mid-July, the average global rubber rice ruled at Rs 244 a kg, Rs 20 higher than the domestic price of Rs 224.
RUBBER BOARD ESTIMATE
The Rubber Board has estimated that domestic rubber production will increase by 4.8 per cent in 2011-12 to 9.02 lakh tonnes while consumption is poised to grow by 3 per cent to 9.77 lakh tonnes. Going by the early trends for the first three months of the current fiscal, the targets are realistic, sources in the Board said.
The potential demand-supply shortfall of 75,000 tonnes can easily be met from the stocks available in the country, they said. The stock available at the end of June was 2.47 lakh tonnes, enough to last over three months. While the industry has been consistently questioning existence of the stock, sources in the trade stated that the difference if any would not be so huge as to create a shortfall in 2011-12.
Given the dynamics of the markets and the global demand-supply position, Indian prices are not expected to fall much.
Rubber Board sources said the first consignment of imports undertaken after the announcement was made, would hit the domestic market only 2-3 months down the line. There is regime of regulatory procedures which have to be complied including regulatory approvals from the Directorate-General of Foreign Trade.
Mr George Valy, President of the Indian Rubber Dealers Federation, said that of the 40,000 tonnes of natural which were permitted to be imported last year, just around 10 per cent would have been imported. Neither did the announcement, nor the actual imports threaten the price line then, he said.
SHORT-TERM BLIP
However, he did not rule out the possibility of a short-term blip in prices in the wake of the latest announcement. But even this trend has not been testified to by the developments of the last couple of days when rubber prices did not evince much erosion.
The price spurt in July was mainly due to low arrivals in the markets on account of incessant rains. This was also the season of high imports. But all that is poised to change from August when domestic production in poised for their annual cyclical upsurge. But the increased arrivals from next month are also not expected to depress prices to any degree since it is going to be dictated by global price trends.
In the worst case scenario, India can always resort to the export market if and when the domestic prices fall Rs 10 below the international prices, Mr Valy said.
Rubber import furore over residual quota, says ATMA
July 20, 2011
Thiruvananthapuram: Nothwithstanding the growing unrest among the political opposition and protesting against the Centre’s decision to import natural rubber, the Automative Tyre Manufacturers Association (ATMA) has stated that the fuss was over import of the “residual quota” and not fresh imports.
There was a hue and cry in Kerala over reports in a section of the press that clearance has been given to import 40,000 tonne with 7.5% as import duty.
“The permission to import 40,000 tonne of natural rubber at 7.5% represents an extension of the earlier deadline of March 2011,” Rajiv Budhraja, director-general, ATMA told FE. “This permission was granted at the fag end of fiscal 2010-2011. Since then the industry was unable to import the entire quota of permitted volumes. Government has now permitted import of the residual quota in the current year,” he said.
In fact, industry had pleaded for import of natural rubber to the extent of domestic production deficit, which ATMA estimates to be to the tune of 2 lakh tonnes in the current fiscal. Commerce ministry has suggested for duty free import of 1 lakh tonne, but this was not favoured by finance ministry.ATMA argues that “mere extension of the deadline for import of residual 40,000 tonne of natural rubber is hardly substantive and just procedural.” Industry, according to Budhraja, is suffering due to widening gap between the domestic production and consumption.
The reports of rubber import, meanwhile, has kicked up a furore in Kerala, which is home to 12 lakh rubber farmers. Within 12 hours of the media report, the price of natural rubber fell from R216 per kg to R211 per kg.
CPM member Suresh Kurup argued that it was the tyre lobby that wanted to bring down the domestic price that created market sensation.
July 21, 2011
KOTTAYAM, JULY 21:
Domestic rubber prices remained under pressure on Thursday. In the spot, prices weakened further on buyer resistance. Declines in the Japanese futures and another weak closing on the National Multi Commodity Exchange weighed on the market, as most of the traders stayed back letting the prices to seek further lows. The news on imports continued to cast its shadow over the sentiments. Among other reports, the key TOCOM rubber futures surrendered on profit taking ahead of the emergency European Summit in Brussels after hitting a six week high on Wednesday.
Sheet rubber dropped to Rs 213 (214) a kg, according to traders. The grade moved down to Rs 213.50 (214.50) a kg both at Kottayam and Kochi, as quoted by the Rubber Board.
The August series weakened to Rs 208.50 (213.01), September to Rs 208.41 (211.92), October to Rs 209.50 (212.30), November to Rs 210.55 (214), December to Rs 211 (214) and January to Rs 210.50 (216.71) a kg for RSS 4 on the NMCE.
The July futures declined to ¥377.6 (Rs 213.08) from ¥381.9 a kg during the day session and then to ¥377.2 (Rs 212.85) in the night session on the Tokyo Commodity Exchange. RSS 3 (spot) slipped to Rs 216.14 (216.30) a kg at Bangkok.
Spot rates were (Rs/kg): RSS-4: 213 (214); RSS-5: 210 (211); ungraded: 206 (208); ISNR 20: 210 (211) and latex 60 per cent: 139 (139).
Rubber prices not expected to fall despite imports at lower duty
July 20, 2011
KOCHI, JULY 20:
The announcement that 40,000 tonnes of natural rubber can be imported at the concessional duty of 7.5 per cent has created a flutter in the market and apprehension in the minds of rubber farmers. What has created greater consternation in the minds of the farming community has been the speed with which the announcement was made.
The announcement came in the backdrop of a short spell of just two weeks when global rubber prices edged lower than domestic prices.
However, Mr R Sanjith, Head of Commodity, United Planters Association of Southern India (UPASI), said that for six months domestic prices were consistently lower than international prices. Between January and mid-July, the average global rubber rice ruled at Rs 244 a kg, Rs 20 higher than the domestic price of Rs 224.
RUBBER BOARD ESTIMATE
The Rubber Board has estimated that domestic rubber production will increase by 4.8 per cent in 2011-12 to 9.02 lakh tonnes while consumption is poised to grow by 3 per cent to 9.77 lakh tonnes. Going by the early trends for the first three months of the current fiscal, the targets are realistic, sources in the Board said.
The potential demand-supply shortfall of 75,000 tonnes can easily be met from the stocks available in the country, they said. The stock available at the end of June was 2.47 lakh tonnes, enough to last over three months. While the industry has been consistently questioning existence of the stock, sources in the trade stated that the difference if any would not be so huge as to create a shortfall in 2011-12.
Given the dynamics of the markets and the global demand-supply position, Indian prices are not expected to fall much.
Rubber Board sources said the first consignment of imports undertaken after the announcement was made, would hit the domestic market only 2-3 months down the line. There is regime of regulatory procedures which have to be complied including regulatory approvals from the Directorate-General of Foreign Trade.
Mr George Valy, President of the Indian Rubber Dealers Federation, said that of the 40,000 tonnes of natural which were permitted to be imported last year, just around 10 per cent would have been imported. Neither did the announcement, nor the actual imports threaten the price line then, he said.
SHORT-TERM BLIP
However, he did not rule out the possibility of a short-term blip in prices in the wake of the latest announcement. But even this trend has not been testified to by the developments of the last couple of days when rubber prices did not evince much erosion.
The price spurt in July was mainly due to low arrivals in the markets on account of incessant rains. This was also the season of high imports. But all that is poised to change from August when domestic production in poised for their annual cyclical upsurge. But the increased arrivals from next month are also not expected to depress prices to any degree since it is going to be dictated by global price trends.
In the worst case scenario, India can always resort to the export market if and when the domestic prices fall Rs 10 below the international prices, Mr Valy said.
Rubber import furore over residual quota, says ATMA
July 20, 2011
Thiruvananthapuram: Nothwithstanding the growing unrest among the political opposition and protesting against the Centre’s decision to import natural rubber, the Automative Tyre Manufacturers Association (ATMA) has stated that the fuss was over import of the “residual quota” and not fresh imports.
There was a hue and cry in Kerala over reports in a section of the press that clearance has been given to import 40,000 tonne with 7.5% as import duty.
“The permission to import 40,000 tonne of natural rubber at 7.5% represents an extension of the earlier deadline of March 2011,” Rajiv Budhraja, director-general, ATMA told FE. “This permission was granted at the fag end of fiscal 2010-2011. Since then the industry was unable to import the entire quota of permitted volumes. Government has now permitted import of the residual quota in the current year,” he said.
In fact, industry had pleaded for import of natural rubber to the extent of domestic production deficit, which ATMA estimates to be to the tune of 2 lakh tonnes in the current fiscal. Commerce ministry has suggested for duty free import of 1 lakh tonne, but this was not favoured by finance ministry.ATMA argues that “mere extension of the deadline for import of residual 40,000 tonne of natural rubber is hardly substantive and just procedural.” Industry, according to Budhraja, is suffering due to widening gap between the domestic production and consumption.
The reports of rubber import, meanwhile, has kicked up a furore in Kerala, which is home to 12 lakh rubber farmers. Within 12 hours of the media report, the price of natural rubber fell from R216 per kg to R211 per kg.
CPM member Suresh Kurup argued that it was the tyre lobby that wanted to bring down the domestic price that created market sensation.
Thursday, July 21, 2011
Rubber Supply Tightness Lasting Until 2018 May Raise Costs for Tiremakers
Rubber Supply Tightness Lasting Until 2018 May Raise Costs for Tiremakers
July 20, 2011
Global supply of natural rubber will remain “tight” at least during the next seven years as output gains among key growers fail to match rising demand from tire and glove makers, according to a producers’ group.
“Tightness in supply will continue until 2018 as production growth is marginal or moderate,” Jom Jacob, a senior economist at the Kuala Lumpur-based Association of Natural Rubber Producing Countries, said in an interview in Bangkok yesterday. The member countries of the group, also called ANRPC, represent 92 percent of global supply.
Limited supplies may help boost a 47 percent rally in rubber futures in Tokyo in the past year, potentially increasing costs for companies such as Bridgestone Corp. (5108), Michelin & Cie. and Goodyear Tire & Rubber Co. (GT), the top three tire makers. Prices may remain “strong” until next year as persistent rains limit gains in output, Pongsak Kerdvongbundit, president of Thai Rubber Association, said yesterday.
A large number of producing rubber trees, which were planted during 1980s, will have to be uprooted between 2012 and 2018, reducing total area of plantations worldwide, Jacob said. Farmers delayed cutting down trees to take advantages of high prices, he added.
Rubber advanced to a record 535.7 yen a kilogram ($6,768 a metric ton) on Feb. 18 as global demand led by China outstripped supply and after rain and flooding curbed output in Thailand and Indonesia, the two largest exporters.
December-delivery contract today gained as much as 3.2 percent to 390.9 yen a kilogram on the Tokyo Commodity Exchange.
Aged Trees
Output from ANRPC member countries may climb to as much as 10.3 million tons next year from 9.9 million tons this year, data from the group show. Production may expand further to 12.2 million tons in 2015 and 13.4 million tons in 2018, it said.
Thailand and Vietnam will have a greater expansion rate, while the growth in Indonesia and Malaysia will probably be stagnant, Jacob said. Some farmers may retain aged trees to gain from high prices, he said.
Rubber production growth in 2015 may increase between 5.8 percent and 6.6 percent, compared with 2 percent to 6 percent in normal years as trees planted in 2008 will be ready for tapping, Jacob said.
The natural rubber shortage may widen to 1 million tons by 2020 as demand from tire makers boosts consumption to about 15.4 million tons, Stephen Evans, secretary general of the International Rubber Study Group said on June 8. Demand this year may gain 4.7 percent to 11.2 million tons, he said.
Chinese Demand
China, the world’s largest consumer, may use 3.5 million tons of natural rubber this year, a 6.1 percent increase from a year earlier, according to ANRPC. Vehicle sales in the Asian nation, the world’s largest automobile market, may grow about 5 percent this year, Zhu Yiping, head of the China Association of Automobile Manufacturers’ statistics department, said on July 8.
Supply deficit in India, the second largest buyer, will widen as increasing car sales boost demand for tires, Vinod Simon, president of All India Rubber Industries Association, said in an interview yesterday. The shortfall may widen to 840,000 tons in 2020 from 175,000 tons this year, he added.
Bridgestone Corp. and its Indian rivals including Apollo Tyres Ltd. (APTY) and MRF Ltd. (MRF) are investing $3 billion in plants to meet rising demand for tires, according to the Automotive Tyre Manufacturers’ Association. Car sales in the world’s second-most populous nation may more than double to 3 million by 2015, according to the government.
Natural rubber output up 5.4% in April-June
July 20, 2011
Natural rubber (NR) production rose 5.4 per cent during April-June, while the slowdown in the growth of consumption continued. Consumption grew 3.9 per cent in the first quarter of the current financial year, according to the provisional figures of the Rubber Board.
The total production in the period was 175,700 tonnes, as against 166,750 tonnes in the corresponding period of the last financial year. Consumption increased to 242,000 tonnes as against 232,850 tonnes.
The export of rubber almost doubled during the period at 8,189 tonnes against 4,323 tonnes in April-June 2010-11. A marginal rise was recorded in imports, as 41,929 tonnes were brought in as against 38,233 tonnes. The Board’s data also estimates a total stock of 247,442 tonnes at the end of the first quarter of 2011-12, while this was 180,697 tonnes in June 2010.
The production of NR in June increased 4.1 per cent to 59,200 tonnes compared to 56,850 tonnes during June 2010. Consumption in June increased marginally (0.6 per cent) to 80,500 tonnes compared to 80,000 tonnes during the same month last year, the Board data showed.
Bloomberg adds: NR prices may remain “strong” until next year, as persistent rain in key producing nations limit gains in output, while demand remains robust for the commodity used in tyres, the Thai Rubber Association said. Rubber futures on the Tokyo Commodity Exchange have expanded 44 per cent this year, helped by rising demand from China, the largest user. The Asian nation, the world’s largest automobile market, will consume 3.5 million tonnes of rubber this year.
NMCE Rubber dips on import duty concerns
July 20, 2011
MUMBAI (Commodity Online): The NMCE Rubber futures plunged on the reports of center allowing concessional duty rubber imports.
The Centre has allowed imports of 40,000 tonnes of natural rubber at a concessional duty of 7.5 per cent for the current fiscal. This is similar to the one allowed last fiscal. Since April 1 this year, the Customs duty on natural rubber has been fixed at 20 per cent or Rs 20 a kg, whichever is lower.
The move to allow imports at a lower duty follows demand from the user industry, particularly tyre manufacturers, to allow import of two lakh tonnes duty-free. Sources said that the Commerce Ministry had recommended allowing imports of one lakh tonnes duty-free.
But the Finance Ministry, which has a final say, has treaded a cautious path in arriving at the final decision. Growers, on the other hand, are totally opposed to imports. The TOCOM Rubber futures are trading with negative cues.
The NMCE Rubber August contract is currently trading at Rs.21500 per quintal, slight higher by 0.64 per cent against the previous close. In the earlier sessions the contract traded at a range of Rs.21251-21524. Volume traded is 1363 lots so far.
Rubber prices not expected to fall despite imports at lower duty
Rubber sheets being dried in open space (file photo): S. Rambabu
The increased arrivals from next month are also not expected to depress prices to any degree since it is going to be dictated by global price trends.
KOCHI, JULY 20:
The announcement that 40,000 tonnes of natural rubber can be imported at the concessional duty of 7.5 per cent has created a flutter in the market and apprehension in the minds of rubber farmers. What has created greater consternation in the minds of the farming community has been the speed with which the announcement was made.
The announcement came in the backdrop of a short spell of just two weeks when global rubber prices edged lower than domestic prices.
However, Mr R Sanjith, Head of Commodity, United Planters Association of Southern India (UPASI), said that for six months domestic prices were consistently lower than international prices. Between January and mid-July, the average global rubber rice ruled at Rs 244 a kg, Rs 20 higher than the domestic price of Rs 224.
RUBBER BOARD ESTIMATE
The Rubber Board has estimated that domestic rubber production will increase by 4.8 per cent in 2011-12 to 9.02 lakh tonnes while consumption is poised to grow by 3 per cent to 9.77 lakh tonnes. Going by the early trends for the first three months of the current fiscal, the targets are realistic, sources in the Board said.
The potential demand-supply shortfall of 75,000 tonnes can easily be met from the stocks available in the country, they said. The stock available at the end of June was 2.47 lakh tonnes, enough to last over three months. While the industry has been consistently questioning existence of the stock, sources in the trade stated that the difference if any would not be so huge as to create a shortfall in 2011-12.
Given the dynamics of the markets and the global demand-supply position, Indian prices are not expected to fall much.
Rubber Board sources said the first consignment of imports undertaken after the announcement was made, would hit the domestic market only 2-3 months down the line. There is regime of regulatory procedures which have to be complied including regulatory approvals from the Directorate-General of Foreign Trade.
Mr George Valy, President of the Indian Rubber Dealers Federation, said that of the 40,000 tonnes of natural which were permitted to be imported last year, just around 10 per cent would have been imported. Neither did the announcement, nor the actual imports threaten the price line then, he said.
SHORT-TERM BLIP
However, he did not rule out the possibility of a short-term blip in prices in the wake of the latest announcement. But even this trend has not been testified to by the developments of the last couple of days when rubber prices did not evince much erosion.
The price spurt in July was mainly due to low arrivals in the markets on account of incessant rains. This was also the season of high imports. But all that is poised to change from August when domestic production in poised for their annual cyclical upsurge. But the increased arrivals from next month are also not expected to depress prices to any degree since it is going to be dictated by global price trends.
In the worst case scenario, India can always resort to the export market if and when the domestic prices fall Rs 10 below the international prices, Mr Valy said.
July 20, 2011
Global supply of natural rubber will remain “tight” at least during the next seven years as output gains among key growers fail to match rising demand from tire and glove makers, according to a producers’ group.
“Tightness in supply will continue until 2018 as production growth is marginal or moderate,” Jom Jacob, a senior economist at the Kuala Lumpur-based Association of Natural Rubber Producing Countries, said in an interview in Bangkok yesterday. The member countries of the group, also called ANRPC, represent 92 percent of global supply.
Limited supplies may help boost a 47 percent rally in rubber futures in Tokyo in the past year, potentially increasing costs for companies such as Bridgestone Corp. (5108), Michelin & Cie. and Goodyear Tire & Rubber Co. (GT), the top three tire makers. Prices may remain “strong” until next year as persistent rains limit gains in output, Pongsak Kerdvongbundit, president of Thai Rubber Association, said yesterday.
A large number of producing rubber trees, which were planted during 1980s, will have to be uprooted between 2012 and 2018, reducing total area of plantations worldwide, Jacob said. Farmers delayed cutting down trees to take advantages of high prices, he added.
Rubber advanced to a record 535.7 yen a kilogram ($6,768 a metric ton) on Feb. 18 as global demand led by China outstripped supply and after rain and flooding curbed output in Thailand and Indonesia, the two largest exporters.
December-delivery contract today gained as much as 3.2 percent to 390.9 yen a kilogram on the Tokyo Commodity Exchange.
Aged Trees
Output from ANRPC member countries may climb to as much as 10.3 million tons next year from 9.9 million tons this year, data from the group show. Production may expand further to 12.2 million tons in 2015 and 13.4 million tons in 2018, it said.
Thailand and Vietnam will have a greater expansion rate, while the growth in Indonesia and Malaysia will probably be stagnant, Jacob said. Some farmers may retain aged trees to gain from high prices, he said.
Rubber production growth in 2015 may increase between 5.8 percent and 6.6 percent, compared with 2 percent to 6 percent in normal years as trees planted in 2008 will be ready for tapping, Jacob said.
The natural rubber shortage may widen to 1 million tons by 2020 as demand from tire makers boosts consumption to about 15.4 million tons, Stephen Evans, secretary general of the International Rubber Study Group said on June 8. Demand this year may gain 4.7 percent to 11.2 million tons, he said.
Chinese Demand
China, the world’s largest consumer, may use 3.5 million tons of natural rubber this year, a 6.1 percent increase from a year earlier, according to ANRPC. Vehicle sales in the Asian nation, the world’s largest automobile market, may grow about 5 percent this year, Zhu Yiping, head of the China Association of Automobile Manufacturers’ statistics department, said on July 8.
Supply deficit in India, the second largest buyer, will widen as increasing car sales boost demand for tires, Vinod Simon, president of All India Rubber Industries Association, said in an interview yesterday. The shortfall may widen to 840,000 tons in 2020 from 175,000 tons this year, he added.
Bridgestone Corp. and its Indian rivals including Apollo Tyres Ltd. (APTY) and MRF Ltd. (MRF) are investing $3 billion in plants to meet rising demand for tires, according to the Automotive Tyre Manufacturers’ Association. Car sales in the world’s second-most populous nation may more than double to 3 million by 2015, according to the government.
Natural rubber output up 5.4% in April-June
July 20, 2011
Natural rubber (NR) production rose 5.4 per cent during April-June, while the slowdown in the growth of consumption continued. Consumption grew 3.9 per cent in the first quarter of the current financial year, according to the provisional figures of the Rubber Board.
The total production in the period was 175,700 tonnes, as against 166,750 tonnes in the corresponding period of the last financial year. Consumption increased to 242,000 tonnes as against 232,850 tonnes.
The export of rubber almost doubled during the period at 8,189 tonnes against 4,323 tonnes in April-June 2010-11. A marginal rise was recorded in imports, as 41,929 tonnes were brought in as against 38,233 tonnes. The Board’s data also estimates a total stock of 247,442 tonnes at the end of the first quarter of 2011-12, while this was 180,697 tonnes in June 2010.
The production of NR in June increased 4.1 per cent to 59,200 tonnes compared to 56,850 tonnes during June 2010. Consumption in June increased marginally (0.6 per cent) to 80,500 tonnes compared to 80,000 tonnes during the same month last year, the Board data showed.
Bloomberg adds: NR prices may remain “strong” until next year, as persistent rain in key producing nations limit gains in output, while demand remains robust for the commodity used in tyres, the Thai Rubber Association said. Rubber futures on the Tokyo Commodity Exchange have expanded 44 per cent this year, helped by rising demand from China, the largest user. The Asian nation, the world’s largest automobile market, will consume 3.5 million tonnes of rubber this year.
NMCE Rubber dips on import duty concerns
July 20, 2011
MUMBAI (Commodity Online): The NMCE Rubber futures plunged on the reports of center allowing concessional duty rubber imports.
The Centre has allowed imports of 40,000 tonnes of natural rubber at a concessional duty of 7.5 per cent for the current fiscal. This is similar to the one allowed last fiscal. Since April 1 this year, the Customs duty on natural rubber has been fixed at 20 per cent or Rs 20 a kg, whichever is lower.
The move to allow imports at a lower duty follows demand from the user industry, particularly tyre manufacturers, to allow import of two lakh tonnes duty-free. Sources said that the Commerce Ministry had recommended allowing imports of one lakh tonnes duty-free.
But the Finance Ministry, which has a final say, has treaded a cautious path in arriving at the final decision. Growers, on the other hand, are totally opposed to imports. The TOCOM Rubber futures are trading with negative cues.
The NMCE Rubber August contract is currently trading at Rs.21500 per quintal, slight higher by 0.64 per cent against the previous close. In the earlier sessions the contract traded at a range of Rs.21251-21524. Volume traded is 1363 lots so far.
Rubber prices not expected to fall despite imports at lower duty
Rubber sheets being dried in open space (file photo): S. Rambabu
The increased arrivals from next month are also not expected to depress prices to any degree since it is going to be dictated by global price trends.
KOCHI, JULY 20:
The announcement that 40,000 tonnes of natural rubber can be imported at the concessional duty of 7.5 per cent has created a flutter in the market and apprehension in the minds of rubber farmers. What has created greater consternation in the minds of the farming community has been the speed with which the announcement was made.
The announcement came in the backdrop of a short spell of just two weeks when global rubber prices edged lower than domestic prices.
However, Mr R Sanjith, Head of Commodity, United Planters Association of Southern India (UPASI), said that for six months domestic prices were consistently lower than international prices. Between January and mid-July, the average global rubber rice ruled at Rs 244 a kg, Rs 20 higher than the domestic price of Rs 224.
RUBBER BOARD ESTIMATE
The Rubber Board has estimated that domestic rubber production will increase by 4.8 per cent in 2011-12 to 9.02 lakh tonnes while consumption is poised to grow by 3 per cent to 9.77 lakh tonnes. Going by the early trends for the first three months of the current fiscal, the targets are realistic, sources in the Board said.
The potential demand-supply shortfall of 75,000 tonnes can easily be met from the stocks available in the country, they said. The stock available at the end of June was 2.47 lakh tonnes, enough to last over three months. While the industry has been consistently questioning existence of the stock, sources in the trade stated that the difference if any would not be so huge as to create a shortfall in 2011-12.
Given the dynamics of the markets and the global demand-supply position, Indian prices are not expected to fall much.
Rubber Board sources said the first consignment of imports undertaken after the announcement was made, would hit the domestic market only 2-3 months down the line. There is regime of regulatory procedures which have to be complied including regulatory approvals from the Directorate-General of Foreign Trade.
Mr George Valy, President of the Indian Rubber Dealers Federation, said that of the 40,000 tonnes of natural which were permitted to be imported last year, just around 10 per cent would have been imported. Neither did the announcement, nor the actual imports threaten the price line then, he said.
SHORT-TERM BLIP
However, he did not rule out the possibility of a short-term blip in prices in the wake of the latest announcement. But even this trend has not been testified to by the developments of the last couple of days when rubber prices did not evince much erosion.
The price spurt in July was mainly due to low arrivals in the markets on account of incessant rains. This was also the season of high imports. But all that is poised to change from August when domestic production in poised for their annual cyclical upsurge. But the increased arrivals from next month are also not expected to depress prices to any degree since it is going to be dictated by global price trends.
In the worst case scenario, India can always resort to the export market if and when the domestic prices fall Rs 10 below the international prices, Mr Valy said.
Tuesday, July 19, 2011
‘Govt nod to import rubber may adversely affect farmers’
‘Govt nod to import rubber may adversely affect farmers’
July 18, 2011
Kerala has expressed concern over the government’s decision to allow import of 40,000 tonnes of rubber by slashing import duty from 20% to 7.5%.
“The decision may adversely affect rubber farmers in the state,” state Finance Minister K M Mani said in Delhi. Farmers are apprehensive that there might be a fall in price of rubber with the decision. However, experts on the sector discounted the possibility of fall in price of domestic produce on account of the import.
“There is no need for panic on account of this decision,” former chairman of Rubber Board PC Syriac said. The government’s move to allow import of rubber was shelved last year due to stiff opposition from MPs from the state and had also raised the import duty to 20%. Kerala accounts for nearly 80 per cent of the area under rubber cultivation in the country.
Centre allows 40,000 tonnes rubber imports at 7.5% concessional duty
Growers disappointed as they fear move may suppress domestic prices
NEW DELHI, JULY 17:
The Centre has allowed imports of 40,000 tonnes of natural rubber at a concessional duty of 7.5 per cent for the current fiscal. This is similar to the one allowed last fiscal.
Since April 1 this year, the Customs duty on natural rubber has been fixed at 20 per cent or Rs 20 a kg, whichever is lower.
The move to allow imports at a lower duty follows demand from the user industry, particularly tyre manufacturers, to allow import of two lakh tonnes duty-free. Sources said that the Commerce Ministry had recommended allowing imports of one lakh tonnes duty-free. But the Finance Ministry, which has a final say, has treaded a cautious path in arriving at the final decision. Growers, on the other hand, are totally opposed to imports.
“The decision to allow import of only 40,000 tonnes that too at 7.5 per cent against a demand to permit two lakh tonnes is disappointing,” said an industry source, who did not wish to be identified. “It is also too little and too late,” the source said.
Last fiscal, the import duty regime was put in place in December for a similar quantity of 40,000 tonnes. This year, though, imports are allowed from this month itself.
The import will meet consumers' need for just 15 days, going by the consumption of 80,500 tonnes in June.
“The decision to allow imports at concessional duty is oppressive. It has come at the most inopportune moment as peak production season is lurking,” said Mr J.K. Thomas, former President of the United Planters' Association of Southern India. “It could suppress domestic prices,” he said.
“The decision is good though it will meet only 15 days demand. It will improve supply in the domestic market. On Saturday, rubber was not available locally. Last week, I scouted for 20 tonnes of rubber and was hardly able to get two tonnes. Rubber is not available locally despite the Rubber Board statistics saying that the carryover stocks at the end of June were 2.47 lakh tonnes,” said Mr N. Radhakrishnan, advisor to the Cochin Rubber Merchants Association.
According to traders, inferior quality sheet rubber is available at Rs 208-201 a kg. The high price for inferior quality rubber makes production unviable for small manufacturers.
“If tyre manufacturers import, then quality rubber will be available for small industries which are suffering,” said Mr Radhakrishnan.
“There is no way other than imports to improve supply,” he said.
“It is an agreed position that imports could be allowed when domestic prices are higher than global rates. That was seen only in two years.
Now, domestic and global prices are at par,” said Mr Thomas.
On Saturday, RSS-4 (ribbed smoked sheet) rubber was quoted at Rs 216 a kg. During the weekend, in the global market RSS-3, the equivalent to Indias's RSS-4, closed at Rs 210 a kg in Bangkok.
In the first quarter this fiscal, rubber imports almost doubled to 38,233 tonnes compared with 19,118 tonnes during the same period a year ago.
Production in the first quarter was 1, 75,700 tonnes, up 5.4 per cent over the same period last year. In comparison, consumption was 2.44 lakh tonnes, up nearly four per cent year-on-year.
Shares of domestic tyre companies shot up in the last week of June on rumours that the Centre would exempt natural rubber imports from customs duty for a specified quantity under a tariff rate quota regime.
Mixed reaction to reports on nod for import of rubber
Media reports on the Union government's nod for import of natural rubber (NR) at subsidised rates has evoked mixed reactions among stakeholders.
When contacted, official sources at the Rubber Board maintained that no official communication had been received from Central authorities so far on the issue. Whenever there were queries from New Delhi on the feasibility of NR imports, the Board had made recommendations against such move, they said.
According to media reports, the Union government had decided in favour of importing 40,000 tonnes of NR at the subsidised import duty rate of 7.5 per cent. This decision was made against the requests made by consumer industry, mainly tyre manufacturers. They had, in fact, asked for import of two lakh tonnes, duty free.
Industry sources pointed out that the current regime allows NR import at the rate of 20 per cent import duty or Rs. 20 a kg, whichever was lower. The 7.5 per cent duty would allow them to import at a lesser rate since the international price of NR has come down and was hovering around Rs.200 for the past one week, against the Rs. 215 a kg in the Indian market. “This would allow the industry to bring in NR on a par with Indian prices. “Add another Rs.12 for handling charges and transportation, the landed cost would be about Rs.227 a kg. However, at Rs. 215 a kg in the internal market, the landed cost would be more than Rs.230 a kg, they maintained.
According to George Valy, president, Indian Rubber Dealers' Federation (IRDF), official sources had put the carryover stock with farmers at more than 90,000 tonnes. However, during the first quarter, there was no sign of this NR stock flowing into the market. “This points to a tendency to hoard, on the part of the small farmers,” he pointed out. According to him, an initial inclination for distress sale on the part of the small framers cannot be ruled out on account of the report of the change in import tariff.
With the international prices coming down and showing signals of no immediate recovery, the new decision would have a negative impact on the NR prices internally, he said and added that the Indian prices ruling at a level lower than the international prices could not be ruled out.
Last financial year too, the Union government had allowed NR import at subsidised duty rates. However, the order in this regard was issued in February 2011 and had a validity till March 31, 2011. However, this year, it has come much earlier.
P.C. Thomas, leader of Kerala Congress (AMG) wanted the Union government to withdraw the decision as it would lead to price crash and destroy the indigenous rubber plantation industry. He
maintained that the government had not followed the procedural formalities for effecting changes in existing duty structure and as such the decision was not valid.
July 18, 2011
Kerala has expressed concern over the government’s decision to allow import of 40,000 tonnes of rubber by slashing import duty from 20% to 7.5%.
“The decision may adversely affect rubber farmers in the state,” state Finance Minister K M Mani said in Delhi. Farmers are apprehensive that there might be a fall in price of rubber with the decision. However, experts on the sector discounted the possibility of fall in price of domestic produce on account of the import.
“There is no need for panic on account of this decision,” former chairman of Rubber Board PC Syriac said. The government’s move to allow import of rubber was shelved last year due to stiff opposition from MPs from the state and had also raised the import duty to 20%. Kerala accounts for nearly 80 per cent of the area under rubber cultivation in the country.
Centre allows 40,000 tonnes rubber imports at 7.5% concessional duty
Growers disappointed as they fear move may suppress domestic prices
NEW DELHI, JULY 17:
The Centre has allowed imports of 40,000 tonnes of natural rubber at a concessional duty of 7.5 per cent for the current fiscal. This is similar to the one allowed last fiscal.
Since April 1 this year, the Customs duty on natural rubber has been fixed at 20 per cent or Rs 20 a kg, whichever is lower.
The move to allow imports at a lower duty follows demand from the user industry, particularly tyre manufacturers, to allow import of two lakh tonnes duty-free. Sources said that the Commerce Ministry had recommended allowing imports of one lakh tonnes duty-free. But the Finance Ministry, which has a final say, has treaded a cautious path in arriving at the final decision. Growers, on the other hand, are totally opposed to imports.
“The decision to allow import of only 40,000 tonnes that too at 7.5 per cent against a demand to permit two lakh tonnes is disappointing,” said an industry source, who did not wish to be identified. “It is also too little and too late,” the source said.
Last fiscal, the import duty regime was put in place in December for a similar quantity of 40,000 tonnes. This year, though, imports are allowed from this month itself.
The import will meet consumers' need for just 15 days, going by the consumption of 80,500 tonnes in June.
“The decision to allow imports at concessional duty is oppressive. It has come at the most inopportune moment as peak production season is lurking,” said Mr J.K. Thomas, former President of the United Planters' Association of Southern India. “It could suppress domestic prices,” he said.
“The decision is good though it will meet only 15 days demand. It will improve supply in the domestic market. On Saturday, rubber was not available locally. Last week, I scouted for 20 tonnes of rubber and was hardly able to get two tonnes. Rubber is not available locally despite the Rubber Board statistics saying that the carryover stocks at the end of June were 2.47 lakh tonnes,” said Mr N. Radhakrishnan, advisor to the Cochin Rubber Merchants Association.
According to traders, inferior quality sheet rubber is available at Rs 208-201 a kg. The high price for inferior quality rubber makes production unviable for small manufacturers.
“If tyre manufacturers import, then quality rubber will be available for small industries which are suffering,” said Mr Radhakrishnan.
“There is no way other than imports to improve supply,” he said.
“It is an agreed position that imports could be allowed when domestic prices are higher than global rates. That was seen only in two years.
Now, domestic and global prices are at par,” said Mr Thomas.
On Saturday, RSS-4 (ribbed smoked sheet) rubber was quoted at Rs 216 a kg. During the weekend, in the global market RSS-3, the equivalent to Indias's RSS-4, closed at Rs 210 a kg in Bangkok.
In the first quarter this fiscal, rubber imports almost doubled to 38,233 tonnes compared with 19,118 tonnes during the same period a year ago.
Production in the first quarter was 1, 75,700 tonnes, up 5.4 per cent over the same period last year. In comparison, consumption was 2.44 lakh tonnes, up nearly four per cent year-on-year.
Shares of domestic tyre companies shot up in the last week of June on rumours that the Centre would exempt natural rubber imports from customs duty for a specified quantity under a tariff rate quota regime.
Mixed reaction to reports on nod for import of rubber
Media reports on the Union government's nod for import of natural rubber (NR) at subsidised rates has evoked mixed reactions among stakeholders.
When contacted, official sources at the Rubber Board maintained that no official communication had been received from Central authorities so far on the issue. Whenever there were queries from New Delhi on the feasibility of NR imports, the Board had made recommendations against such move, they said.
According to media reports, the Union government had decided in favour of importing 40,000 tonnes of NR at the subsidised import duty rate of 7.5 per cent. This decision was made against the requests made by consumer industry, mainly tyre manufacturers. They had, in fact, asked for import of two lakh tonnes, duty free.
Industry sources pointed out that the current regime allows NR import at the rate of 20 per cent import duty or Rs. 20 a kg, whichever was lower. The 7.5 per cent duty would allow them to import at a lesser rate since the international price of NR has come down and was hovering around Rs.200 for the past one week, against the Rs. 215 a kg in the Indian market. “This would allow the industry to bring in NR on a par with Indian prices. “Add another Rs.12 for handling charges and transportation, the landed cost would be about Rs.227 a kg. However, at Rs. 215 a kg in the internal market, the landed cost would be more than Rs.230 a kg, they maintained.
According to George Valy, president, Indian Rubber Dealers' Federation (IRDF), official sources had put the carryover stock with farmers at more than 90,000 tonnes. However, during the first quarter, there was no sign of this NR stock flowing into the market. “This points to a tendency to hoard, on the part of the small farmers,” he pointed out. According to him, an initial inclination for distress sale on the part of the small framers cannot be ruled out on account of the report of the change in import tariff.
With the international prices coming down and showing signals of no immediate recovery, the new decision would have a negative impact on the NR prices internally, he said and added that the Indian prices ruling at a level lower than the international prices could not be ruled out.
Last financial year too, the Union government had allowed NR import at subsidised duty rates. However, the order in this regard was issued in February 2011 and had a validity till March 31, 2011. However, this year, it has come much earlier.
P.C. Thomas, leader of Kerala Congress (AMG) wanted the Union government to withdraw the decision as it would lead to price crash and destroy the indigenous rubber plantation industry. He
maintained that the government had not followed the procedural formalities for effecting changes in existing duty structure and as such the decision was not valid.
Monday, July 18, 2011
Natural rubber imports set to increase on tyre demand
Natural rubber imports set to increase on tyre demand
July 15, 2011
Natural rubber imports by India, the fourth-biggest producer, may climb as much as 13% this year as rising car sales lift demand for the commodity used in tyres and gloves.
Purchases may climb to about 200,000 tonnes in the year that began on April 1 from 177,482 tonnes a year earlier, Rajiv Budhraja, director general of the Automotive Tyre Manufacturers Association, said. Imports in the three months through June rose 10% to 41,929 tonnes, the government-owned Rubber Board said in a statement on Friday. Purchases in June surged 60% to 19,118 tonnes.
Higher Indian purchases may extend a 44% rally in rubber prices in the past year in Tokyo and increase costs for Indian tyremakers including MRF and Apollo Tyres.
“International prices have declined and are now on par with domestic prices, leading to higher purchases from India,” Budhraja said. “Most tyre companies plan imports in the first half as it is the lean production season in India.”
December-delivery rubber gained as much as 1.2% to 380.6 yen a kg ($4,808 a tonnes) before settling at 378 yen at on the Tokyo Commodity Exchange. Futures have tumbled 29% since reaching a record 535.7 yen a kg reached on February 18.
Bridgestone and its Indian rivals including Apollo and MRF are investing $3 billion in plants to meet rising demand for tyres, according to the tyre manufacturers group. Car sales in the world’s second-most populous nation may more than double to 3 million by 2015, according to the government, boosting demand for rubber.
“Main demand for the tyre industry comes from the replacement market for trucks and buses. If the overall economic and the agricultural growth remain good, then the demand from this sector will receive a boost,” he said.
India’s car sales may grow 10% to 12% this financial year, the Society of Indian Automobile Manufacturers said on July 11. That’s less than the 16% to 18% it predicted earlier.
Imports will climb in July even after domestic natural rubber output gained 5.3% in the three months through June, Budhraja said. Production last month advanced 4.1% to 59,200 tonnes, according to the board.
Spot rubber rules steady
July 15, 2011
KOTTAYAM, JULY 15:
Spot rubber ended almost unchanged on Friday. The market lost its direction lacking fresh incentives either from the domestic or international front to catalyze the sentiments. ISNR-20, the only gainer of the day inched up on comparatively better demand. While supply concerns continued to lend support, increased domestic production, rise in imports and slowdown in car sales limited the gains. The transactions were low.
Sheet rubber was steady at Rs 214 a kg, according to traders. The grade improved marginally to Rs 214 (213.50) a kg both at Kottayam and Kochi, as reported by the Rubber Board.
In futures, the July series expired at Rs 213.65 (213.20) while the August series closed at Rs 215.60 (215.86), September at Rs 215.35 (215.98), October at Rs 215.60 (215), November at Rs 216.60 (216.75) and December at Rs 217.89 (218) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 weakened at its July futures to ¥372.9 (Rs 210.12) from ¥373.1 a kg during the day session but then recovered to ¥373.2 (Rs 210.29) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 214 (214); RSS-5: 211 (211); ungraded: 208 (208); ISNR 20: 211 (208) and latex 60 per cent: 137 (137).
Global demand, cost of rubber boosting prices of mega-tires
July 18, 2011
A spike in rubber costs, as well as increasing demand worldwide, is contributing to rising prices for large tires made by Titan Tire Corp. and other tire manufacturers.
Demand for mining tires is “just exploding,” according to Titan, which is owned by Titan International Inc. of Quincy, Ill., and operates a large tire manufacturing facility in Bryan. The company began test production in Bryan last year on 63-inch, 13,000-pound mega-tires for the mining industry, which is booming because of high demand worldwide for gold, iron ore, coal, and other minerals.
Prices for tires about 11 feet across, such as those used onCaterpillar Inc. trucks that haul iron ore and coal, have touched $100,000 on the spot market, according toLeighton Holdings Ltd., a contractor for mining companies, including BHP Billiton Ltd. and Anglo American Ltd. That compares with contract prices of about $30,000, according to Roesler Tyre Innovators GmbH, which retreads so-called off-the-road tires.
Kevin Rohlwing, senior vice president of training for the Tire Industry Association in Maryland, said that the prices of natural rubber and synthetic rubber, which is made with petroleum, have increased substantially in the last couple years.
The price of natural rubber, a main ingredient in large tires, was around $2.23 per pound Friday, compared to $1.70 a pound a year ago and 75 cents a pound in 2009.
“You’re talking about a tire with hundreds of pounds, if not thousands of pounds, of rubber,” Mr. Rohlwing said. “When your main raw material triples in cost, that’s going to filter down to the consumer.”
The price increases are being seen in other areas of the tire market. Titan Tire announced this month it plans to raise prices up to 8 percent for Goodyear-branded farm tires shipped on or after Aug. 1. Raw material, energy, and transportation costs were cited for the price hike.
International demand also has increased for mining tires around the world. Demand from China, the world’s biggest metals buyer, has driven copper, iron ore, gold, and coal to record prices this year, forcing companies to compete for the equipment and labor needed to mine them.
Mr. Rohlwing noted that the majority of industrial-sized tires are made in the United States and Japan, and exported around the world.
“With so many limited numbers of manufacturing plants, and it being such a
July 15, 2011
Natural rubber imports by India, the fourth-biggest producer, may climb as much as 13% this year as rising car sales lift demand for the commodity used in tyres and gloves.
Purchases may climb to about 200,000 tonnes in the year that began on April 1 from 177,482 tonnes a year earlier, Rajiv Budhraja, director general of the Automotive Tyre Manufacturers Association, said. Imports in the three months through June rose 10% to 41,929 tonnes, the government-owned Rubber Board said in a statement on Friday. Purchases in June surged 60% to 19,118 tonnes.
Higher Indian purchases may extend a 44% rally in rubber prices in the past year in Tokyo and increase costs for Indian tyremakers including MRF and Apollo Tyres.
“International prices have declined and are now on par with domestic prices, leading to higher purchases from India,” Budhraja said. “Most tyre companies plan imports in the first half as it is the lean production season in India.”
December-delivery rubber gained as much as 1.2% to 380.6 yen a kg ($4,808 a tonnes) before settling at 378 yen at on the Tokyo Commodity Exchange. Futures have tumbled 29% since reaching a record 535.7 yen a kg reached on February 18.
Bridgestone and its Indian rivals including Apollo and MRF are investing $3 billion in plants to meet rising demand for tyres, according to the tyre manufacturers group. Car sales in the world’s second-most populous nation may more than double to 3 million by 2015, according to the government, boosting demand for rubber.
“Main demand for the tyre industry comes from the replacement market for trucks and buses. If the overall economic and the agricultural growth remain good, then the demand from this sector will receive a boost,” he said.
India’s car sales may grow 10% to 12% this financial year, the Society of Indian Automobile Manufacturers said on July 11. That’s less than the 16% to 18% it predicted earlier.
Imports will climb in July even after domestic natural rubber output gained 5.3% in the three months through June, Budhraja said. Production last month advanced 4.1% to 59,200 tonnes, according to the board.
Spot rubber rules steady
July 15, 2011
KOTTAYAM, JULY 15:
Spot rubber ended almost unchanged on Friday. The market lost its direction lacking fresh incentives either from the domestic or international front to catalyze the sentiments. ISNR-20, the only gainer of the day inched up on comparatively better demand. While supply concerns continued to lend support, increased domestic production, rise in imports and slowdown in car sales limited the gains. The transactions were low.
Sheet rubber was steady at Rs 214 a kg, according to traders. The grade improved marginally to Rs 214 (213.50) a kg both at Kottayam and Kochi, as reported by the Rubber Board.
In futures, the July series expired at Rs 213.65 (213.20) while the August series closed at Rs 215.60 (215.86), September at Rs 215.35 (215.98), October at Rs 215.60 (215), November at Rs 216.60 (216.75) and December at Rs 217.89 (218) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 weakened at its July futures to ¥372.9 (Rs 210.12) from ¥373.1 a kg during the day session but then recovered to ¥373.2 (Rs 210.29) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 214 (214); RSS-5: 211 (211); ungraded: 208 (208); ISNR 20: 211 (208) and latex 60 per cent: 137 (137).
Global demand, cost of rubber boosting prices of mega-tires
July 18, 2011
A spike in rubber costs, as well as increasing demand worldwide, is contributing to rising prices for large tires made by Titan Tire Corp. and other tire manufacturers.
Demand for mining tires is “just exploding,” according to Titan, which is owned by Titan International Inc. of Quincy, Ill., and operates a large tire manufacturing facility in Bryan. The company began test production in Bryan last year on 63-inch, 13,000-pound mega-tires for the mining industry, which is booming because of high demand worldwide for gold, iron ore, coal, and other minerals.
Prices for tires about 11 feet across, such as those used onCaterpillar Inc. trucks that haul iron ore and coal, have touched $100,000 on the spot market, according toLeighton Holdings Ltd., a contractor for mining companies, including BHP Billiton Ltd. and Anglo American Ltd. That compares with contract prices of about $30,000, according to Roesler Tyre Innovators GmbH, which retreads so-called off-the-road tires.
Kevin Rohlwing, senior vice president of training for the Tire Industry Association in Maryland, said that the prices of natural rubber and synthetic rubber, which is made with petroleum, have increased substantially in the last couple years.
The price of natural rubber, a main ingredient in large tires, was around $2.23 per pound Friday, compared to $1.70 a pound a year ago and 75 cents a pound in 2009.
“You’re talking about a tire with hundreds of pounds, if not thousands of pounds, of rubber,” Mr. Rohlwing said. “When your main raw material triples in cost, that’s going to filter down to the consumer.”
The price increases are being seen in other areas of the tire market. Titan Tire announced this month it plans to raise prices up to 8 percent for Goodyear-branded farm tires shipped on or after Aug. 1. Raw material, energy, and transportation costs were cited for the price hike.
International demand also has increased for mining tires around the world. Demand from China, the world’s biggest metals buyer, has driven copper, iron ore, gold, and coal to record prices this year, forcing companies to compete for the equipment and labor needed to mine them.
Mr. Rohlwing noted that the majority of industrial-sized tires are made in the United States and Japan, and exported around the world.
“With so many limited numbers of manufacturing plants, and it being such a
Saturday, July 16, 2011
Natural rubber imports set to increase on tyre demand
Natural rubber imports set to increase on tyre demand
July 15, 2011
Natural rubber imports by India, the fourth-biggest producer, may climb as much as 13% this year as rising car sales lift demand for the commodity used in tyres and gloves.
Purchases may climb to about 200,000 tonnes in the year that began on April 1 from 177,482 tonnes a year earlier, Rajiv Budhraja, director general of the Automotive Tyre Manufacturers Association, said. Imports in the three months through June rose 10% to 41,929 tonnes, the government-owned Rubber Board said in a statement on Friday. Purchases in June surged 60% to 19,118 tonnes.
Higher Indian purchases may extend a 44% rally in rubber prices in the past year in Tokyo and increase costs for Indian tyremakers including MRF and Apollo Tyres.
“International prices have declined and are now on par with domestic prices, leading to higher purchases from India,” Budhraja said. “Most tyre companies plan imports in the first half as it is the lean production season in India.”
December-delivery rubber gained as much as 1.2% to 380.6 yen a kg ($4,808 a tonnes) before settling at 378 yen at on the Tokyo Commodity Exchange. Futures have tumbled 29% since reaching a record 535.7 yen a kg reached on February 18.
Bridgestone and its Indian rivals including Apollo and MRF are investing $3 billion in plants to meet rising demand for tyres, according to the tyre manufacturers group. Car sales in the world’s second-most populous nation may more than double to 3 million by 2015, according to the government, boosting demand for rubber.
“Main demand for the tyre industry comes from the replacement market for trucks and buses. If the overall economic and the agricultural growth remain good, then the demand from this sector will receive a boost,” he said.
India’s car sales may grow 10% to 12% this financial year, the Society of Indian Automobile Manufacturers said on July 11. That’s less than the 16% to 18% it predicted earlier.
Imports will climb in July even after domestic natural rubber output gained 5.3% in the three months through June, Budhraja said. Production last month advanced 4.1% to 59,200 tonnes, according to the board.
Spot rubber rules steady
July 15, 2011
KOTTAYAM, JULY 15:
Spot rubber ended almost unchanged on Friday. The market lost its direction lacking fresh incentives either from the domestic or international front to catalyze the sentiments. ISNR-20, the only gainer of the day inched up on comparatively better demand. While supply concerns continued to lend support, increased domestic production, rise in imports and slowdown in car sales limited the gains. The transactions were low.
Sheet rubber was steady at Rs 214 a kg, according to traders. The grade improved marginally to Rs 214 (213.50) a kg both at Kottayam and Kochi, as reported by the Rubber Board.
In futures, the July series expired at Rs 213.65 (213.20) while the August series closed at Rs 215.60 (215.86), September at Rs 215.35 (215.98), October at Rs 215.60 (215), November at Rs 216.60 (216.75) and December at Rs 217.89 (218) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 weakened at its July futures to ¥372.9 (Rs 210.12) from ¥373.1 a kg during the day session but then recovered to ¥373.2 (Rs 210.29) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 214 (214); RSS-5: 211 (211); ungraded: 208 (208); ISNR 20: 211 (208) and latex 60 per cent: 137 (137).
Rubber production up 4% in June
July 15, 2011
KOCHI, JULY 15:
While the production of natural rubber rose by 4.1 per cent in June, consumption lagged behind at 0.6 per cent. Hence, the gap between production and consumption continued to widen at over 21,000 tonnes. Sources in the Rubber Board said that any crisis in the rubber markets is quite unlikely as there is a buffer stock of 2,47,442 tonnes.
They pointed out that rubber production has been consistently growing in the recent past, mainly on account of growth in the tapped area.
And this growth is likely to continue, as incremental areas that were brought under rubber cultivation in the last six to seven years will begin yielding in the years to come.
Driven by the prevailing higher prices, the tapping intensity is said to have increased last month. This also contributed to the growth in production. The extent of rain guarding is said to have remained stable and not had much of an impact on the growth curve.
Although the intermittent nature of the rains last month would have helped production, sources said that the climate was not very different in June last year either.
Production for the April-June quarter was up 5.4 per cent to 1,75,700 tonnes as against 1,66,750 tonnes last year.
Mr N Radhakrishnan, Advisor to the Cochin Rubber Merchants Association (CRMA), said that enquiries for rubber from upcountry buyers have been poor this week. He attributed this to increased imports.
The quoting price of good quality crump rubber in foreign markets was Rs 198 against Rs 214 for Indian sheet rubber, and several Indian buyers were in the process of importing their raw material. Bulk purchase and imports would always command a lower price, he pointed out.
IMPORTS
Malaysia, Indonesia and Thailand were the three countries from where crump rubber was being imported into India.
Of these, countries like Indonesia offer bargain prices since they consume only around 20 per cent of their total rubber production.
On the contrary, Malaysian rubber industries have been expanding rapidly and consume a significant portion of their own production, Mr Radhakrishnan said.
Imports increased by close to 60 per cent in June, compared with the same month last year.
This is expected to continue this month as well. The growth in imports for the April-June period is also evident as it has almost doubled to 38,233 tonnes from 19,118 tonnes last year.
July 15, 2011
Natural rubber imports by India, the fourth-biggest producer, may climb as much as 13% this year as rising car sales lift demand for the commodity used in tyres and gloves.
Purchases may climb to about 200,000 tonnes in the year that began on April 1 from 177,482 tonnes a year earlier, Rajiv Budhraja, director general of the Automotive Tyre Manufacturers Association, said. Imports in the three months through June rose 10% to 41,929 tonnes, the government-owned Rubber Board said in a statement on Friday. Purchases in June surged 60% to 19,118 tonnes.
Higher Indian purchases may extend a 44% rally in rubber prices in the past year in Tokyo and increase costs for Indian tyremakers including MRF and Apollo Tyres.
“International prices have declined and are now on par with domestic prices, leading to higher purchases from India,” Budhraja said. “Most tyre companies plan imports in the first half as it is the lean production season in India.”
December-delivery rubber gained as much as 1.2% to 380.6 yen a kg ($4,808 a tonnes) before settling at 378 yen at on the Tokyo Commodity Exchange. Futures have tumbled 29% since reaching a record 535.7 yen a kg reached on February 18.
Bridgestone and its Indian rivals including Apollo and MRF are investing $3 billion in plants to meet rising demand for tyres, according to the tyre manufacturers group. Car sales in the world’s second-most populous nation may more than double to 3 million by 2015, according to the government, boosting demand for rubber.
“Main demand for the tyre industry comes from the replacement market for trucks and buses. If the overall economic and the agricultural growth remain good, then the demand from this sector will receive a boost,” he said.
India’s car sales may grow 10% to 12% this financial year, the Society of Indian Automobile Manufacturers said on July 11. That’s less than the 16% to 18% it predicted earlier.
Imports will climb in July even after domestic natural rubber output gained 5.3% in the three months through June, Budhraja said. Production last month advanced 4.1% to 59,200 tonnes, according to the board.
Spot rubber rules steady
July 15, 2011
KOTTAYAM, JULY 15:
Spot rubber ended almost unchanged on Friday. The market lost its direction lacking fresh incentives either from the domestic or international front to catalyze the sentiments. ISNR-20, the only gainer of the day inched up on comparatively better demand. While supply concerns continued to lend support, increased domestic production, rise in imports and slowdown in car sales limited the gains. The transactions were low.
Sheet rubber was steady at Rs 214 a kg, according to traders. The grade improved marginally to Rs 214 (213.50) a kg both at Kottayam and Kochi, as reported by the Rubber Board.
In futures, the July series expired at Rs 213.65 (213.20) while the August series closed at Rs 215.60 (215.86), September at Rs 215.35 (215.98), October at Rs 215.60 (215), November at Rs 216.60 (216.75) and December at Rs 217.89 (218) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 weakened at its July futures to ¥372.9 (Rs 210.12) from ¥373.1 a kg during the day session but then recovered to ¥373.2 (Rs 210.29) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 214 (214); RSS-5: 211 (211); ungraded: 208 (208); ISNR 20: 211 (208) and latex 60 per cent: 137 (137).
Rubber production up 4% in June
July 15, 2011
KOCHI, JULY 15:
While the production of natural rubber rose by 4.1 per cent in June, consumption lagged behind at 0.6 per cent. Hence, the gap between production and consumption continued to widen at over 21,000 tonnes. Sources in the Rubber Board said that any crisis in the rubber markets is quite unlikely as there is a buffer stock of 2,47,442 tonnes.
They pointed out that rubber production has been consistently growing in the recent past, mainly on account of growth in the tapped area.
And this growth is likely to continue, as incremental areas that were brought under rubber cultivation in the last six to seven years will begin yielding in the years to come.
Driven by the prevailing higher prices, the tapping intensity is said to have increased last month. This also contributed to the growth in production. The extent of rain guarding is said to have remained stable and not had much of an impact on the growth curve.
Although the intermittent nature of the rains last month would have helped production, sources said that the climate was not very different in June last year either.
Production for the April-June quarter was up 5.4 per cent to 1,75,700 tonnes as against 1,66,750 tonnes last year.
Mr N Radhakrishnan, Advisor to the Cochin Rubber Merchants Association (CRMA), said that enquiries for rubber from upcountry buyers have been poor this week. He attributed this to increased imports.
The quoting price of good quality crump rubber in foreign markets was Rs 198 against Rs 214 for Indian sheet rubber, and several Indian buyers were in the process of importing their raw material. Bulk purchase and imports would always command a lower price, he pointed out.
IMPORTS
Malaysia, Indonesia and Thailand were the three countries from where crump rubber was being imported into India.
Of these, countries like Indonesia offer bargain prices since they consume only around 20 per cent of their total rubber production.
On the contrary, Malaysian rubber industries have been expanding rapidly and consume a significant portion of their own production, Mr Radhakrishnan said.
Imports increased by close to 60 per cent in June, compared with the same month last year.
This is expected to continue this month as well. The growth in imports for the April-June period is also evident as it has almost doubled to 38,233 tonnes from 19,118 tonnes last year.
Friday, July 15, 2011
Rubber market on July 14: Spot rubber improves on global cues
NR prices on Thur 14 July
July 14, 2011
On Tokyo’s Tocom Exchange, prices for the six-month contract remained unchanged overnight, trading at yen 376 ($4.75) per kg on Thursday 14 July. Shorter-dated prices fell to around yen 373.
In Singapore, SGX said November RSS3 was up $0.03 on Wednesday’s prices at around $4.73. TSR 20 for delivery in Jan 2012 was trading up by $0.01 at $4.54.
In India, the NMCE saw July deliveries fall by a fraction of a rupee, to around Rs212.7 ($4.78) per kilo
In China, the Shanghai Futures Exchange also saw prices unchanged, with July deliveries trading at around Yuan 33.8 ($5.20) per kilo.
Rubber market on July 13: Spot rubber improves on global cues
July 13, 2011
KOTTAYAM, JULY 13:
Spot rubber improved on Wednesday. According to observers, the prices turned better following the moderate recovery in the trend setting international indices. There were enquiries from major consuming industries but they seemed to be keeping a low profile.
Major grades ended higher though the domestic futures failed to hold on the initial gains during late trades probably on selling at higher levels prior to the expiry of its July series.
Sheet rubber increased to Rs 214 from Rs 213 and Rs 212.50 a kg respectively according to traders and the Rubber Board.
In futures, the July series slipped to Rs 212.55 (212.88), August to Rs 215.20 (215.35), September to Rs 214.90 (215.16), October to Rs 215 (215.38) and November to Rs 216.50 (216.75) a kg while the December series inched up to Rs 217.25 (217.03) on the National Multi Commodity Exchange.
RSS 3 firmed up to Rs 210.42 (207.98) a kg at Bangkok. The July futures recovered to ¥377 (Rs 212.02) from ¥369.9 a kg during the day session but then remained inactive in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 214 (213); RSS-5: 212 (210); ungraded: 209 (206); ISNR 20: 210 (210) and latex 60 per cent: 137 (136).
July 14, 2011
On Tokyo’s Tocom Exchange, prices for the six-month contract remained unchanged overnight, trading at yen 376 ($4.75) per kg on Thursday 14 July. Shorter-dated prices fell to around yen 373.
In Singapore, SGX said November RSS3 was up $0.03 on Wednesday’s prices at around $4.73. TSR 20 for delivery in Jan 2012 was trading up by $0.01 at $4.54.
In India, the NMCE saw July deliveries fall by a fraction of a rupee, to around Rs212.7 ($4.78) per kilo
In China, the Shanghai Futures Exchange also saw prices unchanged, with July deliveries trading at around Yuan 33.8 ($5.20) per kilo.
Rubber market on July 13: Spot rubber improves on global cues
July 13, 2011
KOTTAYAM, JULY 13:
Spot rubber improved on Wednesday. According to observers, the prices turned better following the moderate recovery in the trend setting international indices. There were enquiries from major consuming industries but they seemed to be keeping a low profile.
Major grades ended higher though the domestic futures failed to hold on the initial gains during late trades probably on selling at higher levels prior to the expiry of its July series.
Sheet rubber increased to Rs 214 from Rs 213 and Rs 212.50 a kg respectively according to traders and the Rubber Board.
In futures, the July series slipped to Rs 212.55 (212.88), August to Rs 215.20 (215.35), September to Rs 214.90 (215.16), October to Rs 215 (215.38) and November to Rs 216.50 (216.75) a kg while the December series inched up to Rs 217.25 (217.03) on the National Multi Commodity Exchange.
RSS 3 firmed up to Rs 210.42 (207.98) a kg at Bangkok. The July futures recovered to ¥377 (Rs 212.02) from ¥369.9 a kg during the day session but then remained inactive in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 214 (213); RSS-5: 212 (210); ungraded: 209 (206); ISNR 20: 210 (210) and latex 60 per cent: 137 (136).
Tuesday, July 12, 2011
RUBBER-Tokyo futures hit 1-week low due to weak oil, poor US data (July 11)
RUBBER-Tokyo futures hit 1-week low due to weak oil, poor US data (July 11)
July 11, 2011
Bangkok, July 11 (Reuters) – Tokyo rubber futures dropped 2.5 percent to a one-week low on Monday as weak U.S. economic data raised concern about demand, and falling oil prices added to the downward pressure, dealers said.
The benchmark rubber contract on the Tokyo Commodity Exchange <0#JRU:> for December delivery fell 9.8 yen, or 2.5 percent, to settle at 369.4 yen ($4.92) per kg.
It fell to an intra-day low of 369.2 yen, the lowest since July 4.
The most active rubber contract on the Shanghai futures exchange for January delivery fell 680 yuan to finish at 33,665 yuan ($5,207) per tonne.
U.S. jobs growth ground to a near halt in June as employers hired the fewest workers in nine months, frustrating hopes the economy would bounce back quickly from a slowdown in the first half of the year. That signalled poor demand for commodities.
“The U.S. data was not good and weaker oil prices were an additional factor that hammered rubber prices down,” one dealer said.
Oil fell for a second day on Monday, pushed down by the U.S. data plus a drop in China’s crude imports.
In additiona, China’s annual inflation accelerated to a three-year high in June, increasing the chances that the central bank will keep raising interest rates to tame price pressures and raising fears for growth in the car sector.
However, dealers said TOCOM rubber could rebound on Tuesday if it found support at 365 yen and oil prices recovered.
India releases rubber stats for 12 months to March 2011
July 11, 2011
Kottayam, Kerala, India — India’s Rubber Board has released production and consumption statistics for the financial year to the end of March 2011. The data is published in the May 2011 edition of Rubber Statistical News.
Production of Natural Rubber (NR) in the country during 2010-11 was 861,950 tonnes compared to 831,400 tonnes during 2009-10 and recorded a growth of 3.7% compared to the previous year.
Synthetic Rubber production increased to 110,340 tonnes during 2010-11 from 106,743 tonnes during 2009-10, registering a growth of 3.4% as against a growth of 10.3% during 2009-10. The share of poly-butadiene rubber was 69% during 2010-11.
total consumption of NR in 2010-11 was 947,715 tonnes with a growth of 1.8% as against 930,565 tonnes during 2009-10. The auto tyre sector registered a growth of 3.7% as against 13.4% achieved during 2009-10.
SR consumption increased to 411,830 tonnes during 2010-11 registering a growth of 18.4% as against 347,710 tonnes consumed during 2009-10. The automotive tyre sector consumed 298,414 tonnes of SR during 2010-11 as against 238,153 tonnes during 2009-10, recording a growth of 25.3%.
The relative share of consumption of NR and SR in India changed to 70:30 during 2010-11 from 73:27 during 2009-10.
Crude Oil Falls for a Second Day in New York as U.S. Jobless Rate Climbs
July 11, 2011
Bloomberg - Oil declined for a second day in New York as investors bet rising unemployment in the U.S. indicated that fuel demand may falter in the world’s biggest crude- consuming nation.
Futures slipped as much as 0.5 percent after the Labor Department said July 8 that U.S. employers last month added the fewest workers in nine months and the unemployment rate rose to 9.2 percent, the highest this year. A report this week may show sales at U.S. retailers stagnated in June.
“The one thing that’s going to restrain the demand recovery is this very high unemployment rate,” said Ben Westmore, a minerals and energy economist at National Australia Bank Ltd. in Melbourne, who predicts oil in New York will average $113 a barrel in the third quarter. “It dims the outlook on the second half of the year for demand.”
Crude for August delivery fell as much as 47 cents to $95.73 a barrel in electronic trading on the New York Mercantile Exchange, and was at $95.91 at 10:50 a.m. Sydney time. The contract dropped $2.47, or 2.5 percent, to $96.20 on July 8. Prices are 28 percent higher the past year.
Brent oil for August settlement was at $118.18 a barrel, down 15 cents, on the London-based ICE Futures Europe exchange. The European benchmark contract was at a premium of $22.11 to U.S. futures. The difference reached a record $22.29 on June 15.
U.S. payrolls increased by 18,000 in June, the Labor Department data showed. The median estimate in a Bloomberg News survey called for a gain of 105,000. A Commerce Department report on July 14 may show an unchanged reading in purchases in June after a 0.2 percent May decrease, according to the median forecast in a Bloomberg News survey.
July 11, 2011
Bangkok, July 11 (Reuters) – Tokyo rubber futures dropped 2.5 percent to a one-week low on Monday as weak U.S. economic data raised concern about demand, and falling oil prices added to the downward pressure, dealers said.
The benchmark rubber contract on the Tokyo Commodity Exchange <0#JRU:> for December delivery fell 9.8 yen, or 2.5 percent, to settle at 369.4 yen ($4.92) per kg.
It fell to an intra-day low of 369.2 yen, the lowest since July 4.
The most active rubber contract on the Shanghai futures exchange for January delivery fell 680 yuan to finish at 33,665 yuan ($5,207) per tonne.
U.S. jobs growth ground to a near halt in June as employers hired the fewest workers in nine months, frustrating hopes the economy would bounce back quickly from a slowdown in the first half of the year. That signalled poor demand for commodities.
“The U.S. data was not good and weaker oil prices were an additional factor that hammered rubber prices down,” one dealer said.
Oil fell for a second day on Monday, pushed down by the U.S. data plus a drop in China’s crude imports.
In additiona, China’s annual inflation accelerated to a three-year high in June, increasing the chances that the central bank will keep raising interest rates to tame price pressures and raising fears for growth in the car sector.
However, dealers said TOCOM rubber could rebound on Tuesday if it found support at 365 yen and oil prices recovered.
India releases rubber stats for 12 months to March 2011
July 11, 2011
Kottayam, Kerala, India — India’s Rubber Board has released production and consumption statistics for the financial year to the end of March 2011. The data is published in the May 2011 edition of Rubber Statistical News.
Production of Natural Rubber (NR) in the country during 2010-11 was 861,950 tonnes compared to 831,400 tonnes during 2009-10 and recorded a growth of 3.7% compared to the previous year.
Synthetic Rubber production increased to 110,340 tonnes during 2010-11 from 106,743 tonnes during 2009-10, registering a growth of 3.4% as against a growth of 10.3% during 2009-10. The share of poly-butadiene rubber was 69% during 2010-11.
total consumption of NR in 2010-11 was 947,715 tonnes with a growth of 1.8% as against 930,565 tonnes during 2009-10. The auto tyre sector registered a growth of 3.7% as against 13.4% achieved during 2009-10.
SR consumption increased to 411,830 tonnes during 2010-11 registering a growth of 18.4% as against 347,710 tonnes consumed during 2009-10. The automotive tyre sector consumed 298,414 tonnes of SR during 2010-11 as against 238,153 tonnes during 2009-10, recording a growth of 25.3%.
The relative share of consumption of NR and SR in India changed to 70:30 during 2010-11 from 73:27 during 2009-10.
Crude Oil Falls for a Second Day in New York as U.S. Jobless Rate Climbs
July 11, 2011
Bloomberg - Oil declined for a second day in New York as investors bet rising unemployment in the U.S. indicated that fuel demand may falter in the world’s biggest crude- consuming nation.
Futures slipped as much as 0.5 percent after the Labor Department said July 8 that U.S. employers last month added the fewest workers in nine months and the unemployment rate rose to 9.2 percent, the highest this year. A report this week may show sales at U.S. retailers stagnated in June.
“The one thing that’s going to restrain the demand recovery is this very high unemployment rate,” said Ben Westmore, a minerals and energy economist at National Australia Bank Ltd. in Melbourne, who predicts oil in New York will average $113 a barrel in the third quarter. “It dims the outlook on the second half of the year for demand.”
Crude for August delivery fell as much as 47 cents to $95.73 a barrel in electronic trading on the New York Mercantile Exchange, and was at $95.91 at 10:50 a.m. Sydney time. The contract dropped $2.47, or 2.5 percent, to $96.20 on July 8. Prices are 28 percent higher the past year.
Brent oil for August settlement was at $118.18 a barrel, down 15 cents, on the London-based ICE Futures Europe exchange. The European benchmark contract was at a premium of $22.11 to U.S. futures. The difference reached a record $22.29 on June 15.
U.S. payrolls increased by 18,000 in June, the Labor Department data showed. The median estimate in a Bloomberg News survey called for a gain of 105,000. A Commerce Department report on July 14 may show an unchanged reading in purchases in June after a 0.2 percent May decrease, according to the median forecast in a Bloomberg News survey.
Thursday, July 7, 2011
Spot rubber improves on lack of sellers
Spot rubber improves on lack of sellers
KOTTAYAM, JULY 6:
Physical rubber prices scaled further highs on Wednesday. Supply concerns following the resumption of rain and the absence of quantity sellers continued to strengthen the market. There was no buying pressure from major consuming industries.
However, rising domestic rubber production, slowdown in auto sales, widening gap between the domestic and international prices and increased use of rain guards may limit future gains, analysts said. Sheet rubber firmed up to Rs 217 (215) a kg, according to traders. The grade improved to Rs 216.50 (214.50) a kg both at Kottayam and Kochi, according to the Rubber Board.
The July series closed at Rs 213.80 (213.73), August at Rs 216.15 (216.82), September at Rs 215 (214.61), October at Rs 215.56 (215.45), November at Rs 218.80 (220.90) and December at Rs 219.71 (219.20) a kg on the National Multi Commodity Exchange.
RSS 3 increased to Rs 213.36 (211.54) a kg at Bangkok. The July futures moved up to ¥391.7 (Rs 214.85) from ¥383.1 a kg during the day session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 217 (215); RSS-5: 214 (212); ungraded: 210 (209); ISNR 20: 212 (211) and latex 60 per cent: 137 (136).
Keywords: rubber
RUBBER-Tokyo futures rise, firmer commodities support (July 6)
July 6, 2011
TOKYO, July 6 (Reuters) – Key Tokyo rubber futures rose on Wednesday, supported by other commodities markets which rallied the day before on views a second-quarter slump was overdone, but trading was expected to be rangebound given a lack of fresh incentives.
FUNDAMENTALS
* The key Tokyo Commodity Exchange rubber contract for December delivery <0#2JRU:> rose 4.7 yen, or 1.2 percent, to 381.1 yen per kg as of 0017 GMT.
* The most active Shanghai rubber contract for January delivery closed at 33,765 yuan per tonne on Tuesday, up from Monday’s close at 33,480 yuan. Volume stood at 607,720 lots.
* U.S. crude futures extended gains on Wednesday, edging closer to a three-week intraday high marked the previous day, as investors awaited key industry data expected to show a decline in U.S. crude inventories.
* The euro stayed on the back foot in Asia on Wednesday, having suffered a steep fall against the Swiss franc and the dollar after Moody’s slashed Portugal’s credit rating to junk status.
* For top stories on the rubber market and other news, click , or
MARKET NEWS
* Toyota Motor Corp will return to unrestricted production in October, one month earlier than expected, as the last of the disrupted parts after the earthquake get restored, the Asahi newspaper reported on Wednesday, citing the company.
* French auto maker Renault’s worldwide vehicle sales will be better in the second half of the year than in the first half, its new chief operating officer, Carlos Tavares, said on Tuesday.
* European services growth slowed in June in the face of sluggish new orders and rising interest rates, giving firms less optimism about the year ahead, business surveys showed on Tuesday.
* Moody’s on Tuesday cut Portugal’s credit standing to junk in the first such move by a ratings agency and warned the country may well need a second round of rescue funds before it can return to capital markets.
* The Nikkei stock average posted gains for a seventh consecutive day on Wednesday.
* U.S. stocks ended a thinly traded session mostly flat on Tuesday as investors paused after last week’s surge, though continually light volume suggested the market could encounter more choppy trading.
NYMEX-Crude extends gains ahead of key data
July 6, 2011
TOKYO, July 6 (Reuters) – U.S. crude futures extended gains on Wednesday, edging closer to a three-week intraday high marked the previous day, as investors awaited key industry data expected to show a decline in U.S. crude inventories.
Oil also got support from an upgraded price forecast from Barclays Capital and upbeat U.S. factory orders.
FUNDAMENTALS
* NYMEX crude for August delivery was up 16 cents at $97.05 a barrel by 2340 GMT, after settling up $1.95 at $96.89 on Tuesday.
The contract hit $97.48 on Tuesday, the highest for front-month NYMEX crude since June 15.
* London Brent crude for August delivery was as yet untraded, after settling up $2.22 at $113.61, the highest since June 22.
* Barclays Capital raised its 2012 forecast for Brent by $10 to $115 per barrel, and upgraded its 2012 forecast for U.S. crude by $4 to $110. The bank left its Brent forecast for 2011 at $112 but cut its U.S. crude 2011 forecast by $6 to $100.
* Brent will fall to $90 a barrel by September because of the International Energy Agency’s move to release oil reserves and an increase in Saudi Arabia’s production, before bouncing for the longer term, Citigroup said.
* Exxon Mobil Corp does not have a definite repair plan yet for the ruptured Montana crude oil pipeline that it shut over the weekend, and company and government officials are still trying to determine the cause of the spill, a top executive said on Tuesday.
* The market awaited the release of key weekly data by the American Petroleum Institute later in the day.
A Reuters poll of analysts forecast that domestic crude stocks fell 2.3 million barrels in the week to July 1.
Distillate stocks were forecast up 600,000 barrels while gasoline inventories were projected to have been little changed from the week to June 24.
* The Commodity Futures Trading Commission released data on Tuesday for commodities including soybeans, cattle and crude oil showing changes in traders’ positions since the beginning of 2009.
“The data shows that, in many cases, less than 20 percent of average daily trading volume results in traders changing their net long or net short all-futures- combined positions,” said Gary Gensler, the head of the futures regulator.
MARKETS NEWS
* U.S. stocks ended a thinly traded session mostly flat on Tuesday as investors paused after last week’s surge, though continually light volume suggested the market could encounter more choppy trading.
The Nasdaq closed higher for its sixth straight day, helped by strength in Netflix, while the Dow and the S&P 500 ended five-day streaks that marked the best week for equities in two years.
* The euro fell against the dollar and the Swiss franc on Tuesday, snapping six straight days of gains, after Moody’s cut Portugal’s credit rating to junk.
India’s rubber marrket news: July 5, 2011
July 6, 2011
Rubber yesterday traded with the negative node and settled -0.37% down at 21340 as rising domestic rubber production, slowing auto sales, widening spread between the domestic and international rubber prices, increased use of rain guards weighed on prices. Japan crude rubber inventories declined eight per cent to its lowest in about five months.
Rubber inventories by June 20was at 6845 tonnes from ten days before. In yesterday’s trading session Rubber has touched the low of 21261 after opening at 21050, and finally settled at 21340. For today’s session market is looking to take support at 21188, a break below could see a test of 21037 and where as resistance is now likely to be seen at 21564, a move above could see prices testing 21789.
KOTTAYAM, JULY 6:
Physical rubber prices scaled further highs on Wednesday. Supply concerns following the resumption of rain and the absence of quantity sellers continued to strengthen the market. There was no buying pressure from major consuming industries.
However, rising domestic rubber production, slowdown in auto sales, widening gap between the domestic and international prices and increased use of rain guards may limit future gains, analysts said. Sheet rubber firmed up to Rs 217 (215) a kg, according to traders. The grade improved to Rs 216.50 (214.50) a kg both at Kottayam and Kochi, according to the Rubber Board.
The July series closed at Rs 213.80 (213.73), August at Rs 216.15 (216.82), September at Rs 215 (214.61), October at Rs 215.56 (215.45), November at Rs 218.80 (220.90) and December at Rs 219.71 (219.20) a kg on the National Multi Commodity Exchange.
RSS 3 increased to Rs 213.36 (211.54) a kg at Bangkok. The July futures moved up to ¥391.7 (Rs 214.85) from ¥383.1 a kg during the day session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 217 (215); RSS-5: 214 (212); ungraded: 210 (209); ISNR 20: 212 (211) and latex 60 per cent: 137 (136).
Keywords: rubber
RUBBER-Tokyo futures rise, firmer commodities support (July 6)
July 6, 2011
TOKYO, July 6 (Reuters) – Key Tokyo rubber futures rose on Wednesday, supported by other commodities markets which rallied the day before on views a second-quarter slump was overdone, but trading was expected to be rangebound given a lack of fresh incentives.
FUNDAMENTALS
* The key Tokyo Commodity Exchange rubber contract for December delivery <0#2JRU:> rose 4.7 yen, or 1.2 percent, to 381.1 yen per kg as of 0017 GMT.
* The most active Shanghai rubber contract for January delivery closed at 33,765 yuan per tonne on Tuesday, up from Monday’s close at 33,480 yuan. Volume stood at 607,720 lots.
* U.S. crude futures extended gains on Wednesday, edging closer to a three-week intraday high marked the previous day, as investors awaited key industry data expected to show a decline in U.S. crude inventories.
* The euro stayed on the back foot in Asia on Wednesday, having suffered a steep fall against the Swiss franc and the dollar after Moody’s slashed Portugal’s credit rating to junk status.
* For top stories on the rubber market and other news, click , or
MARKET NEWS
* Toyota Motor Corp will return to unrestricted production in October, one month earlier than expected, as the last of the disrupted parts after the earthquake get restored, the Asahi newspaper reported on Wednesday, citing the company.
* French auto maker Renault’s worldwide vehicle sales will be better in the second half of the year than in the first half, its new chief operating officer, Carlos Tavares, said on Tuesday.
* European services growth slowed in June in the face of sluggish new orders and rising interest rates, giving firms less optimism about the year ahead, business surveys showed on Tuesday.
* Moody’s on Tuesday cut Portugal’s credit standing to junk in the first such move by a ratings agency and warned the country may well need a second round of rescue funds before it can return to capital markets.
* The Nikkei stock average posted gains for a seventh consecutive day on Wednesday.
* U.S. stocks ended a thinly traded session mostly flat on Tuesday as investors paused after last week’s surge, though continually light volume suggested the market could encounter more choppy trading.
NYMEX-Crude extends gains ahead of key data
July 6, 2011
TOKYO, July 6 (Reuters) – U.S. crude futures extended gains on Wednesday, edging closer to a three-week intraday high marked the previous day, as investors awaited key industry data expected to show a decline in U.S. crude inventories.
Oil also got support from an upgraded price forecast from Barclays Capital and upbeat U.S. factory orders.
FUNDAMENTALS
* NYMEX crude for August delivery was up 16 cents at $97.05 a barrel by 2340 GMT, after settling up $1.95 at $96.89 on Tuesday.
The contract hit $97.48 on Tuesday, the highest for front-month NYMEX crude since June 15.
* London Brent crude for August delivery was as yet untraded, after settling up $2.22 at $113.61, the highest since June 22.
* Barclays Capital raised its 2012 forecast for Brent by $10 to $115 per barrel, and upgraded its 2012 forecast for U.S. crude by $4 to $110. The bank left its Brent forecast for 2011 at $112 but cut its U.S. crude 2011 forecast by $6 to $100.
* Brent will fall to $90 a barrel by September because of the International Energy Agency’s move to release oil reserves and an increase in Saudi Arabia’s production, before bouncing for the longer term, Citigroup said.
* Exxon Mobil Corp does not have a definite repair plan yet for the ruptured Montana crude oil pipeline that it shut over the weekend, and company and government officials are still trying to determine the cause of the spill, a top executive said on Tuesday.
* The market awaited the release of key weekly data by the American Petroleum Institute later in the day.
A Reuters poll of analysts forecast that domestic crude stocks fell 2.3 million barrels in the week to July 1.
Distillate stocks were forecast up 600,000 barrels while gasoline inventories were projected to have been little changed from the week to June 24.
* The Commodity Futures Trading Commission released data on Tuesday for commodities including soybeans, cattle and crude oil showing changes in traders’ positions since the beginning of 2009.
“The data shows that, in many cases, less than 20 percent of average daily trading volume results in traders changing their net long or net short all-futures- combined positions,” said Gary Gensler, the head of the futures regulator.
MARKETS NEWS
* U.S. stocks ended a thinly traded session mostly flat on Tuesday as investors paused after last week’s surge, though continually light volume suggested the market could encounter more choppy trading.
The Nasdaq closed higher for its sixth straight day, helped by strength in Netflix, while the Dow and the S&P 500 ended five-day streaks that marked the best week for equities in two years.
* The euro fell against the dollar and the Swiss franc on Tuesday, snapping six straight days of gains, after Moody’s cut Portugal’s credit rating to junk.
India’s rubber marrket news: July 5, 2011
July 6, 2011
Rubber yesterday traded with the negative node and settled -0.37% down at 21340 as rising domestic rubber production, slowing auto sales, widening spread between the domestic and international rubber prices, increased use of rain guards weighed on prices. Japan crude rubber inventories declined eight per cent to its lowest in about five months.
Rubber inventories by June 20was at 6845 tonnes from ten days before. In yesterday’s trading session Rubber has touched the low of 21261 after opening at 21050, and finally settled at 21340. For today’s session market is looking to take support at 21188, a break below could see a test of 21037 and where as resistance is now likely to be seen at 21564, a move above could see prices testing 21789.
Wednesday, July 6, 2011
Spot rubber recovers on global cues
Spot rubber recovers on global cues
KOTTAYAM, JULY 4:
The domestic rubber market recovered on Monday. In the spot, prices made moderate gains in tune with the domestic and international futures.
According to observers, there has been fresh buying and short covering expecting revised quotes from the tyre sector and the volumes were better.
Sheet rubber improved to Rs 213 (210) a kg, according to traders. The grade closed firm at Rs 211.50 (210) a kg both at Kottayam and Kochi, according to the Rubber Board.
The July series flared up to Rs 214.48 (208.38), August to Rs 216.98 (210.03), September to Rs 214.29 (208.05), October to Rs 215.50 (207.90), November to 215.69 (207.40) and December to Rs 219 (212.80) a kg for RSS 4 on the National Multi Commodity Exchange.
Meanwhile, the key Tokyo rubber futures advanced more than 3 per cent buoyed by rising oil prices. RSS 3 (spot) inched up to Rs 207.95 (207.13) a kg at Bangkok. The July futures bounced back to ¥383.9 (Rs 211.05) from ¥370.5 a kg during the day session but then remained inactive in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 213 (210); RSS-5: 210 (208); ungraded: 207 (204); ISNR 20: 209 (206) and latex 60 per cent: 135 (133.50).
Chennai will be largest auto cluster in the globe, says Chief Minister
Business Line Tamil Nadu Chief Minister Ms Jayalalithaa with the CII team members- ( from left) Mr Kris Gopalakrishnan, Vice President; Mr Adi Godrej, President Designate; Mr T.T. Ashok ( partially seen), Chairman, CII ( Southern Region); Mr R. Dinesh, Vice Chairman, CII Tamil Nadu State Council ; Mr B. Muthuraman, President, CII; and Mr Chandrajit Banerjee, Director General, at the National Council Meeting of the CII, in Chennai on Tuesday. - Photo : Bijoy Ghosh
Industry captains urged to invest in State; power fears allayed
CHENNAI, JULY 5:
The Tamil Nadu Chief Minister, Ms J. Jayalalithaa, made a strong pitch to the manufacturing sector to invest in Tamil Nadu, even as she allayed industry's fears on the prevailing power shortage in the State.
The State Government will soon bring out a clear cut set of policies for promoting investments in infrastructure including power, ports and ship building.
The policy document, Vision Document 2025, “will meet your expectations,” she said, addressing the national council of the Confederation of Indian Industry, where over 100 chief executives from top companies had gathered. Tamil Nadu is also working fast to tackle power shortage, she said.
Govt support
The Government hopes to develop Chennai, which is set to emerge among the top five auto clusters globally, as the world's largest destination for automotive industry.
It is now a strong pitch for automotive sector with companies making bicycles, cars, trucks, earth moving equipment, rail coaches and even battle tanks present in the city.
“Tamil Nadu will be your ideal platform to generate wealth,” Ms Jayalalithaa assured the heads of the corporate sector, whose companies, according to CII representatives, together account for over two-thirds of India's GDP.
In a speech peppered with quotes from economists, literary figures and statesmen, the Chief Minister laid equal emphasis on the State Government's support to equitable development and social issues.
Improving the quality of life of the general public is the focal point of the economic policies. The development agenda envisages a great role for the captains of the industry, she said.
Goals on focus
Tamil Nadu will achieve the UN Millennium Development Goals on poverty eradication, education, healthcare, environment sustainability, gender equality and global partnerships by 2015.
The State will go beyond these targets to fully do away with poverty and unemployment, asserted Ms Jayalalithaa.
Mr Adi Godrej, President Designate, CII and Chairman, the Godrej Group, urged the State Government to come out with a five-year plan that charts out measures to achieve 10 per cent growth in the State GDP.
He requested Ms Jayalalithaa to look into the process of expediting building plan approvals which have come to a standstill in the last six months.
Brent crude oil rises above $112 after BarCap note
July 5, 2011
LONDON, July 5 (Reuters) – North Sea Brent jumped more than $1 per barrel on Tuesday after Barclays Capital raised its forecasts for crude oil in 2012, outweighing worries over the global economy.
ICE Brent futures for August rose $1.43 to a high of $112.82 before easing back to trade around $112.25 by 1100 GMT. U.S. crude was up 60 cents at $95.54 per barrel from Friday’s close. U.S. financial markets were closed on Monday for the July 4 national holiday.
Barclays Capital on Tuesday raised its 2012 forecast for Brent by $10 to $115 per barrel, and upped its 2012 forecast for U.S. crude by $4 to $110. The bank said in a note it left its Brent forecast for 2011 unchanged at $112 but cut its 2011 forecast for U.S. crude by $6 to $100.
“The increase in expectations is due to a forecast further reduction in global spare capacity in 2012, together with a significant intensification of the geopolitical background to the oil market,” Barclays Capital said.
“Our detailed 2012 supply and demand forecasts show a continuation of robust emerging market demand,” it added.
The Barclays Capital report helped the market reverse losses that had pushed Brent down to an early low of $110.45.
Deutsche Bank said earlier it cut its forecasts for Brent in 2011 to $114 from $117.50, and for 2012 to $117 from $117.50. It said it expected Brent to climb to $125 in 2015.
U.S. light crude futures were expected to average around $100 in 2011, Deutsche Bank said.
Commodities markets are concerned about the outlook for the global economy, the Greek debt crisis and a stronger dollar.
China, the world’s second-biggest oil consumer and a major consumer of commodities, is experiencing a slowdown in economic growth, sounding warning bells across financial markets.
Ratings agency Moody’s said on Tuesday that China’s local government debt may be 3.5 trillion yuan ($540 billion) larger than estimated, which could make banks liable for deeper losses and threaten their credit worthiness. [ID:nL3E7I507Y]
CHINA WORRIES
The news follows data last week showing China’s factory sector grew at its slowest pace in 28 months in June, fuelling fears of a big drop in demand, which could impact suppliers worldwide.
“Almost all the economic data is weak and demand data is also poor. China is always a concern for oil markets because the country is such a big consumer,” said Christophe Barret, global oil analyst at Credit Agricole.
In Europe, the market’s initial optimism over euro zone policymakers’ approval of an emergency bailout for Greece was tempered by Standard & Poor’s negative view of a planned second Greek bailout package. [ID:nL6E7I408N]
Oil traders were keeping a wary eye on the United States, where Treasury Secretary Timothy Geithner has warned of huge risks if Congress fails to raise the $14.3 trillion debt ceiling by Aug. 2, potentially triggering a default.
Participants awaited the key U.S. non-farm payrolls report on Friday for signs economic growth in the world’s top oil consumer has regained traction.
Data on U.S. durable goods and factory orders for May due at 1400 GMT on Tuesday will also give an indication of the state of demand in the world’s biggest oil consumer.
Weekly U.S. oil inventory data from industry group the American Petroleum Institute and the government’s Department of Energy will be delayed by a day to Wednesday and Thursday, respectively, due to Monday’s Independence Day holiday.
Oil prices came under some pressure from a stronger dollar, which rose 0.2 percent against a basket of currencies, making dollar-denominated oil more expensive.
According to technical price charts, Brent crude needs to clear resistance at $113 a barrel before developing a decent rally towards a short-term resistance target at $121.47, while U.S. crude is expected to rise to $98.13 a barrel, said Reuters market analyst Wang Tao. [TECH/C]
Car sales get a boost in June
July 5, 2011
DETROIT — Falling gas prices and more aggressive discounting from two Japanese automakers have pulled June car sales out of their May doldrums, according to analysts, but the market remains weaker than its pace in the first four months of the year.
The March 11 earthquake and tsunami damaged some assembly and parts plants in northern Japan, causing Toyota, Honda and Nissan to delay production of more than 500,000 vehicles.
“There is some increase due to more incentive spending, especially from Honda and Toyota,” said Jesse Toprak, who tracks sales for TrueCar.com. “Even so, Toyota is still going to be down 10 percent compared to last year and Honda will be down about 14 percent.”
Japanese automakers are beginning to make up lost production, but Nissan has been hurt less because it has only 25 percent of its global production in Japan, compared with 45 percent for Toyota. Honda assembles in Japan only 13 percent of the vehicles it sells in North America.
Eight of Toyota’s 12 North American-built models returned to pre-earthquake production June 6. Total North American production is expected to match that level in September, said Steve St. Angelo, head of Toyota’s North American manufacturing and engineering.
Honda said it expects its North American factories to return to full production in August for all models except the 2012 Civic.
“It’s going to really take several months for their production to come back to 100 percent of pre-earthquake volumes,” Toprak said, “probably not before the fourth quarter.”
Edmunds.com, a consumer information and market research firm, estimates Americans bought new vehicles at an annual rate of 11.9 million, slightly better than May’s 11.8 million annual pace but down from more than 13 million between February and April.
TrueCar’s Toprak said Toyota and Honda spent more on rebates and subsidized financing in June after dealers reported consumers were staying away.
Consequently, those two automakers likely will regain some, but not all, of the market share they lost in May.
General Motors, Ford and Chrysler are expected to hold on to most of the market share they gained in May but are spending less on marketing incentives because dealers don’t have large inventories.
KOTTAYAM, JULY 4:
The domestic rubber market recovered on Monday. In the spot, prices made moderate gains in tune with the domestic and international futures.
According to observers, there has been fresh buying and short covering expecting revised quotes from the tyre sector and the volumes were better.
Sheet rubber improved to Rs 213 (210) a kg, according to traders. The grade closed firm at Rs 211.50 (210) a kg both at Kottayam and Kochi, according to the Rubber Board.
The July series flared up to Rs 214.48 (208.38), August to Rs 216.98 (210.03), September to Rs 214.29 (208.05), October to Rs 215.50 (207.90), November to 215.69 (207.40) and December to Rs 219 (212.80) a kg for RSS 4 on the National Multi Commodity Exchange.
Meanwhile, the key Tokyo rubber futures advanced more than 3 per cent buoyed by rising oil prices. RSS 3 (spot) inched up to Rs 207.95 (207.13) a kg at Bangkok. The July futures bounced back to ¥383.9 (Rs 211.05) from ¥370.5 a kg during the day session but then remained inactive in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 213 (210); RSS-5: 210 (208); ungraded: 207 (204); ISNR 20: 209 (206) and latex 60 per cent: 135 (133.50).
Chennai will be largest auto cluster in the globe, says Chief Minister
Business Line Tamil Nadu Chief Minister Ms Jayalalithaa with the CII team members- ( from left) Mr Kris Gopalakrishnan, Vice President; Mr Adi Godrej, President Designate; Mr T.T. Ashok ( partially seen), Chairman, CII ( Southern Region); Mr R. Dinesh, Vice Chairman, CII Tamil Nadu State Council ; Mr B. Muthuraman, President, CII; and Mr Chandrajit Banerjee, Director General, at the National Council Meeting of the CII, in Chennai on Tuesday. - Photo : Bijoy Ghosh
Industry captains urged to invest in State; power fears allayed
CHENNAI, JULY 5:
The Tamil Nadu Chief Minister, Ms J. Jayalalithaa, made a strong pitch to the manufacturing sector to invest in Tamil Nadu, even as she allayed industry's fears on the prevailing power shortage in the State.
The State Government will soon bring out a clear cut set of policies for promoting investments in infrastructure including power, ports and ship building.
The policy document, Vision Document 2025, “will meet your expectations,” she said, addressing the national council of the Confederation of Indian Industry, where over 100 chief executives from top companies had gathered. Tamil Nadu is also working fast to tackle power shortage, she said.
Govt support
The Government hopes to develop Chennai, which is set to emerge among the top five auto clusters globally, as the world's largest destination for automotive industry.
It is now a strong pitch for automotive sector with companies making bicycles, cars, trucks, earth moving equipment, rail coaches and even battle tanks present in the city.
“Tamil Nadu will be your ideal platform to generate wealth,” Ms Jayalalithaa assured the heads of the corporate sector, whose companies, according to CII representatives, together account for over two-thirds of India's GDP.
In a speech peppered with quotes from economists, literary figures and statesmen, the Chief Minister laid equal emphasis on the State Government's support to equitable development and social issues.
Improving the quality of life of the general public is the focal point of the economic policies. The development agenda envisages a great role for the captains of the industry, she said.
Goals on focus
Tamil Nadu will achieve the UN Millennium Development Goals on poverty eradication, education, healthcare, environment sustainability, gender equality and global partnerships by 2015.
The State will go beyond these targets to fully do away with poverty and unemployment, asserted Ms Jayalalithaa.
Mr Adi Godrej, President Designate, CII and Chairman, the Godrej Group, urged the State Government to come out with a five-year plan that charts out measures to achieve 10 per cent growth in the State GDP.
He requested Ms Jayalalithaa to look into the process of expediting building plan approvals which have come to a standstill in the last six months.
Brent crude oil rises above $112 after BarCap note
July 5, 2011
LONDON, July 5 (Reuters) – North Sea Brent jumped more than $1 per barrel on Tuesday after Barclays Capital raised its forecasts for crude oil in 2012, outweighing worries over the global economy.
ICE Brent futures for August rose $1.43 to a high of $112.82 before easing back to trade around $112.25 by 1100 GMT. U.S. crude was up 60 cents at $95.54 per barrel from Friday’s close. U.S. financial markets were closed on Monday for the July 4 national holiday.
Barclays Capital on Tuesday raised its 2012 forecast for Brent by $10 to $115 per barrel, and upped its 2012 forecast for U.S. crude by $4 to $110. The bank said in a note it left its Brent forecast for 2011 unchanged at $112 but cut its 2011 forecast for U.S. crude by $6 to $100.
“The increase in expectations is due to a forecast further reduction in global spare capacity in 2012, together with a significant intensification of the geopolitical background to the oil market,” Barclays Capital said.
“Our detailed 2012 supply and demand forecasts show a continuation of robust emerging market demand,” it added.
The Barclays Capital report helped the market reverse losses that had pushed Brent down to an early low of $110.45.
Deutsche Bank said earlier it cut its forecasts for Brent in 2011 to $114 from $117.50, and for 2012 to $117 from $117.50. It said it expected Brent to climb to $125 in 2015.
U.S. light crude futures were expected to average around $100 in 2011, Deutsche Bank said.
Commodities markets are concerned about the outlook for the global economy, the Greek debt crisis and a stronger dollar.
China, the world’s second-biggest oil consumer and a major consumer of commodities, is experiencing a slowdown in economic growth, sounding warning bells across financial markets.
Ratings agency Moody’s said on Tuesday that China’s local government debt may be 3.5 trillion yuan ($540 billion) larger than estimated, which could make banks liable for deeper losses and threaten their credit worthiness. [ID:nL3E7I507Y]
CHINA WORRIES
The news follows data last week showing China’s factory sector grew at its slowest pace in 28 months in June, fuelling fears of a big drop in demand, which could impact suppliers worldwide.
“Almost all the economic data is weak and demand data is also poor. China is always a concern for oil markets because the country is such a big consumer,” said Christophe Barret, global oil analyst at Credit Agricole.
In Europe, the market’s initial optimism over euro zone policymakers’ approval of an emergency bailout for Greece was tempered by Standard & Poor’s negative view of a planned second Greek bailout package. [ID:nL6E7I408N]
Oil traders were keeping a wary eye on the United States, where Treasury Secretary Timothy Geithner has warned of huge risks if Congress fails to raise the $14.3 trillion debt ceiling by Aug. 2, potentially triggering a default.
Participants awaited the key U.S. non-farm payrolls report on Friday for signs economic growth in the world’s top oil consumer has regained traction.
Data on U.S. durable goods and factory orders for May due at 1400 GMT on Tuesday will also give an indication of the state of demand in the world’s biggest oil consumer.
Weekly U.S. oil inventory data from industry group the American Petroleum Institute and the government’s Department of Energy will be delayed by a day to Wednesday and Thursday, respectively, due to Monday’s Independence Day holiday.
Oil prices came under some pressure from a stronger dollar, which rose 0.2 percent against a basket of currencies, making dollar-denominated oil more expensive.
According to technical price charts, Brent crude needs to clear resistance at $113 a barrel before developing a decent rally towards a short-term resistance target at $121.47, while U.S. crude is expected to rise to $98.13 a barrel, said Reuters market analyst Wang Tao. [TECH/C]
Car sales get a boost in June
July 5, 2011
DETROIT — Falling gas prices and more aggressive discounting from two Japanese automakers have pulled June car sales out of their May doldrums, according to analysts, but the market remains weaker than its pace in the first four months of the year.
The March 11 earthquake and tsunami damaged some assembly and parts plants in northern Japan, causing Toyota, Honda and Nissan to delay production of more than 500,000 vehicles.
“There is some increase due to more incentive spending, especially from Honda and Toyota,” said Jesse Toprak, who tracks sales for TrueCar.com. “Even so, Toyota is still going to be down 10 percent compared to last year and Honda will be down about 14 percent.”
Japanese automakers are beginning to make up lost production, but Nissan has been hurt less because it has only 25 percent of its global production in Japan, compared with 45 percent for Toyota. Honda assembles in Japan only 13 percent of the vehicles it sells in North America.
Eight of Toyota’s 12 North American-built models returned to pre-earthquake production June 6. Total North American production is expected to match that level in September, said Steve St. Angelo, head of Toyota’s North American manufacturing and engineering.
Honda said it expects its North American factories to return to full production in August for all models except the 2012 Civic.
“It’s going to really take several months for their production to come back to 100 percent of pre-earthquake volumes,” Toprak said, “probably not before the fourth quarter.”
Edmunds.com, a consumer information and market research firm, estimates Americans bought new vehicles at an annual rate of 11.9 million, slightly better than May’s 11.8 million annual pace but down from more than 13 million between February and April.
TrueCar’s Toprak said Toyota and Honda spent more on rebates and subsidized financing in June after dealers reported consumers were staying away.
Consequently, those two automakers likely will regain some, but not all, of the market share they lost in May.
General Motors, Ford and Chrysler are expected to hold on to most of the market share they gained in May but are spending less on marketing incentives because dealers don’t have large inventories.
Subscribe to:
Posts (Atom)
