October 20, 2011
By Rakesh Neelakandan Is the Indian Rubber market facing acute shortage of natural rubber?
Is there any problem with the statistical methods that India Rubber Board employs to calculate stocks?
As per the latest figures available with India’s Rubber Board, June-end surplus stocks—or stocks that are available for July with traders—stands at 190312 metric tons.
Meanwhile, the anticipated production figures for August and September are pegged at 71200 tons and 80200 tons respectively. Consumption for the same months are estimated to be 77000 tons and 74000 tons.
The table tells that the excess requirement for the month of August and September stands at 5800 tons and 6200 tons respectively. Imports—block rubber and sheet rubber—for the months stand at 17605 tons and 9100 tons. While the scenario of excess demand fades in August due to aggressive imports at 17605 tons, excess demand for September is expected to be at 2900 tons.
Now, as slowdown takes over the global economy, sluggishness is visible with consumption of rubber in offtakes down to 74000 tons for the month of September.
Though data to this end is yet to be made available, one can safely assume that with July surplus at 190312 tons, coupled with global slowdown denting demand, the requirement would be lethargic.
Result: Surplus Rubber in the country
(Quantity in tons)
Addressing the second question: it is often held by industry bodies like ATMA(Automotive Tyre Manufacturers Association) and AIRIA(All India Rubber Industries Association) that rubber board is making a serious statistical error in calculating the stocks in country; that board is taking into account even the already sold stock which is the inventory of various manufacturing companies.
But, as long as natural rubber is kept as it is, as long as natural rubber is not converted to end-product, the board has no other options; but to follow the current methodology in tabulating stocks.
And the Board is providing stock figures in a segregated form in its statistical news bulletin published every month which is available online.
So, the conclusion that Board’s ‘erroneous’ figures may affect policy prescriptions holds no water.
Source: http://www.commodityonline.com/news/Solving-the-data-puzzle-on-India-natural-rubber-fundamentals-43105-3-1.html
Tokyo futures hit 14-month low on EU debt woes
October 20, 2011
BANGKOK, Oct 20 (Reuters) – Renewed worries about Europe’s debt crisis dragged Tokyo rubber futures to their lowest level in 14 months on Thursday, below the key psychological level of 300 yen, with weaker oil and share prices adding to the pressure, dealers said.
The benchmark rubber contract on the Tokyo Commodity Exchange <0#JRU:> for March delivery tumbled 20.0 yen, or 6.6 percent, to settle at 281.5 yen ($3.66) per kg. That was the lowest since mid-August 2010.
The most active rubber contract on the Shanghai futures exchange fell 1,170 yuan to finish at 25,445 yuan ($3,989) per tonne.
“Rubber sentiment was not so good after prices broke below 300 yen and it seemed like Europe’s debt crisis could weigh on the market longer than expected,” one dealer said.
Plans to tackle the euro zone debt crisis have stalled, with Paris and Berlin at odds over how to increase the firepower of the region’s bailout fund.
Brent crude slipped below $108 on Thursday, after plunging 2.5 percent in the previous session because of worries that Europe’s failure to end the crisis could hurt oil demand.
Dealers said they expected TOCOM prices to move in a range of 280-290 yen on Friday.
A Fact on the Global Auto Market
October 20, 2011
20 October 2011
Yium Tavarolit, Bangkok
The Scotiabank Group reported on its website on 11 October 2011 that auto sales are accelerating in most regions. While Asia leads global auto markets, North Americans returned to dealer showrooms in September despite volatile financial markets and concerns about the economic outlook. The U.S. passenger car sales showed an annual rise of 13 million units in September, the highest level since 1 April. Light trucks and pick-up trucks and SUV volumes surged more than 20% above a year earlier.
The Group continued that while financial markets remain fixated on the ongoing debt problems inWestern Europe and its impact on global economic activity, the global auto industry is rebounding from this summer’s chain-induced disruption. It added that the global vehicle output rose 5% year on year in August, a sharp improvement from a 2% decline in 2Q11. Assemblies inAsia totaled an annual rate of 40 million units, up from a low of 31 million units in April. Its assemblies is expected to jump to an annual rate of 44 million units for the final months of 2011, surpassing the late-2010 peak and accounting for a record 57% of global vehicle output.
Meanwhile, China’s passenger car sales rose 8.79% in September from a year earlier to 1.32 million units, the China Association of Automobile Manufacturers (CAAM) said 13 October. For the first nine months, passenger car sales rose 6.38% to 10.5 million units from a year earlier. Overall car sales in China are expected to grow less than 5% in 2011, said a senior official of CAAM on the same day. Xiong Chuanlin, Vice Secretary of CAAM said China’s auto exports would likely hit a record high of 800,000 units this year.
“Luxury car sales also continued to surge in September despite Europe’s deepening debt crisis and slowing economic growth in several major markets, making it likely that BMW AG, Daimler AG and Volkswagen AG’s Audi brand will report solid third-quarter earnings growth,” the WSJ Newswires reported on 11 October. Sales for BMW brand rose 9.3% in September to 128,446 units while sales of Audi brand rose by 17% from a year earlier in September to 120,200 units, with strong growth in China, where sales rose 33% to 29,476 units. Also, Daimler’s Mercedes-Benz brand sold 120,982 units for September or up 2% year on year. The brand’s sales rose 7.6% to 919,288 units in the first nine months of the year.
Source: http://www.irco.biz/BlogMoreDetial.php?id=2781%20&ShowContent=%20news
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