Market on Dec 27: Rubber ends flat on holiday note
December 27, 2011
MUMBAI, DEC. 27:
Spot rubber closed unchanged on Tuesday. According to market circles, there were neither buyers nor sellers in the market and most of the traders were still in a holiday mood in between Christmas and the New Year. The trend was partially mixed as RSS 5 slipped marginally amidst scattered transactions.
Stocks in NMCE accredited warehouses have been on the rise since last two weeks, reports said. The stocks fell to its lowest level during this year on 1st December. In the international markets activities were slowing down ahead of the New Year holidays and celebrations.
Sheet rubber finished steady at Rs 200 a kg according to traders. The grade slipped to Rs 200 (200.50) a kg both at Kottayam and Kochi as reported by the Rubber Board.
The January series closed at Rs 203.10 (203.88), February at Rs 205.70 (206.06), March at Rs 208.65 (209), April at Rs 214.50 (214.40), May at Rs 214 (214.12) and June at Rs 212.05 (213) a kg for RSS 4 on National Multi Commodity Exchange (NMCE).
Threat of latex price hike
Written by HMH | December 28, 2011 | 0 |
Sustainability of raw materials key to glovemakers’ margin recovery
THE rubber glove industry might be hit by a rise in latex price soon, said research analysts who maintained their “neutral” stance on the sector.
The main risk for glovemakers was higher rubber prices which accounted for 65% to 70% of costs, said CIMB Research.
Analysts opined that the current low latex price was unsustainable as rubber production was likely to be reduced due to the monsoon season as well as measures to shore up rubber prices by Thailand, Indonesia and Malaysia (which together account for 70% of the world’s rubber production).
RHB Research Institute noted that latex prices had gradually strengthened to RM6.88 per kg.
Kenanga Research’s sensitivity analysis showed that for every 1% rise in latex price, earnings would fall by 3% for Kossan Rubber Industries Bhd and Supermax Corp Bhd, both of which have a slightly balanced mix (of natural rubber and nitrile gloves), and a higher 9% fall for Top Glove Corp Bhd, which is predominantly a natural rubber glove player.
However, recent news reports have highlighted that rubber prices might decline if China, the world’s largest rubber consumer, sees slower growth in its economy and motor vehicle sales next year.
It should be noted that for the first 11 months of this year, China auto sales stood at 16.8 million units, rising only 2.56% from a year earlier, according to the China Association of Automobile Manufacturers.
To put this into perspective, Chinese auto sales saw a 34% year-on-year increase in the previous corresponding period, which was reflective of the stunning pace of growth that China’s motor vehicle industry had seen in the past few years.
China watchers had said the world’s second biggest economy was expected to see a slowdown in its growth momentum to 8.5% next year, which would be lowest for over a decade, due to largely to weakened external demand and continued economic uncertainty in Europe.
Kenanga Research noted that there could be a price war in the nitrile glove segment as new production capacity kicked in next year. “We believe that nitrile glove makers would reduce prices to gain market share. This poses a threat to Hartalega Holdings Bhd, which has a 90% share in the nitrile glove segment.”
RHB Research concurred, saying in a report that downward pressure on selling prices of nitrile gloves would affect manufacturers such as Hartalega and Kossan over the longer term.
Meanwhile, glovemakers are also not expected to continue to benefit over the longer term, from the recent appreciation of the greenback against the ringgit.
Kenanga Research said glove players had their earnings enhanced from 4% to 9% for every 1% appreciation in the dollar.
RHB Research believed the strengthening of the US dollar is just temporary, on the back of a reversal in capital flow.
“As the outflow normalises, we expect the ringgit to strengthen to around RM3 against the greenback fundamentally, and further to the RM2.80 to RM2.90 range over the longer term,” said RHB Research.
Earnings rebound
Meanwhile, CIMB Research said glovemakers’ earnings would rebound in the financial year 2012 due to improved utilisation and moderating costs.
“We forecast a two-year CAGR (compound annual growth rate) of 10% to 20% on the back of a 12.4% annual capacity growth until 2013, cost savings due to higher contribution from nitrile (an alternative to latex gloves) and improved utilisation rates as glovemakers switch to the more affordable nitrile.”
The research house noted that nitrile’s cost of production was 25% lower than natural rubber. Also, nitrile’s price is more stable as it is quoted monthly, and glovemakers can pass on costs more effectively.
However, CIMB Research also maintained a “neutral” stance on the sector as there were risks of rubber prices exceeding forecasts and intensifying competition.
HwangDBS Vickers Research also said the key to margin recovery for glove makers was the sustainability of raw material prices.
The potential impact of the rise in energy costs is not expected to have a significant impact on earnings, as electricity and natural gas costs only account for about 3%-4% and 6%-7% of total operating costs respectively, according to RHB Research. “We expect the manufacturers to pass on the cost increase to customers.”
Kenanga Research said it was expecting some stock trading opportunities in the first quarter of next year due to the anticipation of stronger margins from the glove players on the current lower latex price and the timing difference from the appreciating US dollar.
CIMB Research said the risk of higher rubber prices was partially accounted for in its target stock prices for the sector’s players, as its FY12-13 rubber price forecast was 20% above the spot price.
CIMB Research said its top stock pick was Hartalega, which was building its sixth glove plant and upgrading existing plants to enhance capacity by an additional 4.2 billion pieces of gloves. “Overall, by end-FY13, Hartalega will have an annual capacity of 10.7 billion pieces of gloves.”
Also, Hartalega’s push into China has tremendous potential, as per capita glove consumption in the country is only 2.2 pieces annually compared with 100 in the United States and 50 in Europe.
CIMB Research kept its “outperform” call on Hartalega, with a target price of RM8.44, which was pegged to a forward price-to-earnings ratio (P/E) of 11.75 times.
The research house also kept its “outperform” call on Supermax, with a target price of RM4.38, based on a 9.8 times forward P/E.
It noted that Supermax has a focus on the dental market (which accounts for 47% of group sales) as the number two player with a 9.2% market share in the United States.
Supermax will also build two new plants in Klang that will add capacity of 3.9 billion gloves per annum by end-FY13, giving it a total annual capacity of 25 billion gloves.
Supermax is likely to complete its one-for-one bonus issue before the end of next month.
CIMB Research also noted that this will add 340 million shares, enhance the stock’s trading liquidity and allow for better price discovery.
Kenanga Research said it preferred Kossan (“outperform” with a target price of RM3.64) for its well balanced mix in nitrile and latex gloves. It maintains the recommendations on Hartalega (“outperform”; RM6.43), Top Glove (“underperform”; RM3.74), Adventa (“market perform”; RM1.41) and Supermax (market perform; RM2.94).
Rubber prices drop but little respite for tyre makers
Written by HMH | December 28, 2011 | 0 |
Rubber prices have fallen over the last few months, which should bring a cheer among tyre manufacturers. But that is unlikely for at least the third and fourth quarters, as the recent rupee depreciation has increased import costs, thus limiting the gains if any from falling cost of the key raw material.
Price of rubber has fallen to around Rs 200 a kg from Rs 240 in April. Natural rubber accounts for 44% of total raw material costs of tyre makers. So a drop in its price should be good news as it will boost margins. However, gains will be limited this time around.
“There will be very small improvement in margins, at best 20-30 basis points sequentially. Tyre companies import a lot of rubber, so the depreciation in rupee will hurt,” Vineet Hetamasaria, vice president – research at brokerage Pinc told moneycontrol.com.
About 50% of the tyre industry’s raw materials, including rubber, are imported. So the rupee depreciation makes importing expensive. Apollo Tyres , for instance, is expecting a better third quarter, compared with July-September, but margins will be under pressure still.
Rubber prices may have fallen to Rs 200 a kg, but they are still much higher than the Rs 110 a kg two years ago, according to Neeraj Kanwar, vice chairman and MD of Apollo Tyres.
In July-September, the company’s raw material cost was up 57% year-on-year. Other tyre makers too saw a surge in input costs. MRF ’s raw material costs rose 43% for the fiscal year ended September 30.
“As far as Apollo is concerned, in Q3 we will have better profit margins, though there is still challenge on bottomline and margins are still very much under pressure,” he told CNBC-TV18 recently.
On the volume front too there is not much good news. Automobile sales accelerated 30% in 2010-11, which prompted many tyre makers to expand capacities to cater to the strong demand. But high fuel prices, and expensive loans have hit auto sales, especially passenger cars, where volumes are down 3.5% year-on-year over April-November.
“On the volume front things are not looking good as car sales remain subdued and that will affect tyre sales too,” Hetamasaria said.
Although commercial vehicle sales have maintained a steady uptick, here too tyre sales remain slow due to a drop in after-market demand, analysts say. The mining ban in Karnataka and Goa among other regions too has hurt tyre sales in the CV segment.
“Car and truck tyre dealers in northern and western India largely affirm that medium and heavy commercial vehicle tyre off-take remains sluggish, while the demand for two-wheelers and LCVs has held up so far. Overall, dealers expect growth in 2011-12 to be at a subdued 10%,” said Rohan Korde and Nirav Bhatt of Anand Rathi Research.
Production too has been slow due to sluggish sales. Tyre production in India rose only 10% year-on-year in April-September, according to Automotive Tyre Manufacturers’ Association data.
Due to the recent sluggish demand tyre manufacturers haven’t been able to take any price hikes over the last few months, a move that could have eased some pressures.
In the last three months, there have been no price increases, nor have the dealers provided any discounts, point out the Anand Rathi analysts.
Tyre stocks were mixed on Wednesday. While TVS Srichakra and Ceat were up 0.5-1%, MRF , Apollo, JK Tyre and Goodyear India were down 0.5-2%. Since April this year, JK Tyre and Ceat have been among the worst performers among its peers, down 33%, 30% respectively. Apollo Tyres is up 12.7% and MRF has risen 8.5%.
Pinc and Anand Rathi Research have “buy” rating on Apollo Tyres.
Thursday, December 29, 2011
Monday, December 26, 2011
Rubber mart players to stay on sidelines next week.
Rubber mart players to stay on sidelines next week.
December 24, 2011
The Malaysian rubber market is expected to be quiet next week as most of the players would stay on the sidelines due to the festive season and holiday, dealers said.
A dealer said rubber production, which has been hit by the uncertain weather condition, was expected to influence next week’s prices.
“The market is worried about the shortage situation,” she said.
For the week just-ended, the market was unstable on supply worries as most of the rubber producing countries faced the raining season.
The Malaysian Rubber Board’s official physical price for tyre-grade SMR 20 rose 26.5 sen to 1,053.5 sen a kg from 1,027 sen a week earlier, while latex-in-bulk fell 6.5 sen to 663.5 sen a kg from 670 sen previously.
The unofficial closing price for SMR 20 added 14.0 sen to 1,053.5 sen a kg from 1,039.5 sen on Friday while latex-in-bulk slipped six sen to 664 sen from 670.0 sen last week.
The Malaysia rubber market will be closed on Monday for the Christmas celebration. — Bernama
Synthetic rubber output down 10% in Sept
December 23, 2011
New Delhi, Dec 23 (PTI) Synthetic rubber output fell by 10 per cent to 8,421 tonne in September, while consumption declined by 3 per cent to 33,510 tonne, according to Rubber Board data.
In September last year, the production of synthetic rubber stood at 9,320 tonne and consumption at 34,480 tonne.
The consumption by the auto tyre industry also declined by 5 per cent to 24,010 tonne in September 2011, compared to 25,323 tonne in the year-ago period.
Synthetic rubber is mostly used in the manufacture of tyres in the country.
India”s synthetic rubber imports, however, rose by 7 per cent to 26,760 tonne in September this year from 25,025 tonne in the same period last year.
In the first half of the current fiscal, synthetic rubber production rose to 54,750 tonne from 53,231 tonne in the same period last fiscal, while consumption increased to 2,13,075 tonne from 2,01,625 tonne in the same period.
Similarly, auto tyre industry consumed 1,54,887 tonne in April-September 2011 as against 1,44,126 tonne in the same period of the previous year.
Likewise, the total imports in April-September in this fiscal rose to 1,73,490 tonnes from 1,51,435 tonne in the same period last fiscal.
The total stock of synthetic rubber in the country at the end of September, 2011 stood at 51,015 tonne.
Market on Dec 23: Spot rubber shows mixed trend
December 23, 2011
KOTTAYAM, DEC. 23:
Physical rubber prices showed a mixed mood on Friday. The market appeared to be in a holiday mood with only a couple of days to Christmas and hence most of the participants were reluctant to make any new commitments. The volumes were narrow.
Sheet rubber weakened to Rs 200 (201) a kg according to traders. The grade slipped to Rs 200.50 (201) a kg both at Kottayam and Kochi as quoted by the Rubber Board.
In futures, the January series improved to Rs 204.55 (202.86), February to Rs 206.50 (204.70), March to Rs 209.30 (207.36), April to Rs 213.90 (212.78) and May to Rs 214.50 (213.20) a kg on the National Multi Commodity Exchange (NMCE).
RSS 3 (spot) dropped to Rs 178.92 (179.15) a kg at Bangkok. The Tokyo Commodity Exchange remained closed owing to “The Emperor’s Birthday”.
Spot rates were (Rs/kg): RSS-4: 200 (201); RSS-5: 196 (196); ungraded: 190 (190); ISNR 20: 191 (190) and latex 60 per cent: 110 (110).
Rubber limps, but tyre makers smarting
December 24, 2011
Respite eludes the demand- and margin-deprived Indian tyre industry. As high import costs offset fall in raw material prices, tyre-makers are struggling to maintain their margins. Negative industry outlook is not exactly helping matters.
About 50% of industry’s inputs are currently imported. With the rupee weakening against the US dollar, the soaring import cost has emerged as the biggest concern, in contrast to this time last year, when rise in raw material prices unsettled the industry.
It appears the only silver lining in the past quarter has been the stable prices of raw materials, particularly of natural rubber.
Prices of rubber (which accounts for some 43% of total raw material costs) rose sharply in 2010-11, peaking in April at Rs240 per kg. They have, however, started to soften around Rs200 per kg now.
On the other hand, rupee has depreciated almost 20% since September. This is pressuring tyre-makers. And they are unable to pass on the pressure to others due to sluggish demand in the automobile industry.
“The depreciation of rupee has heavily impacted us. Whatever marginal gains we got due to the falling natural rubber prices has been nullified as our import cost shot up. Out of the total raw material used for making tyres, 50% is being imported currently,” said Ajay Sevekari, director, Bridgestone Tyres.
Uncertainty continues to dog the industry. The auto industry slowdown, particularly in the passenger car segment, has directly affected the tyre industry. Although the commercial vehicle (CV) segment is growing robustly, its after-market has slowed. All this has affected the pricing power of the major players in the industry.
“Despite steep increase in import cost, we are not in a position to absorb price hikes,” said Sevekari of Bridgestone.
“The demand in the (CV) after-market has dropped by 15% this year as compared to last year. Ban on mining in certain states has affected the after-market demand directly. All these factors do not allow us to take pricing action,” said Satish Sharma, chief, India operations, Apollo Tyres.
Till October in the current financial year, the tyre industry grew just about 6.5%. ATMA (All India Tyre Manufacturers’ Association) data suggest segments like passenger car tyres and CV tyres saw a dip in growth in September and October.
Many companies had focused on exports in order to offset weak domestic demand. Exports, however, seem to have taken a back seat now as domestic currencies of different countries are weakening.
“Export orders are currently kept on hold and payments are also coming. This has added to the concerns of tyre-makers. There is a lot of uncertainty and pressure in the market,” said
Rajiv Buddharaja, president, ATMA.
For tyre major Ceat, the year so far has been good on account of robust exports. “Our imports and exports are hedged. Till December(-end), we are comfortable as far as exports are concerned. Q4, however, looks tight as the (US) dollar is appreciating against many currencies. Exports can be a challenge going ahead,” said Arnab Banerjee, executive director – operations, Ceat.
Rubber Demand in China to Slow in 2012 as Auto Sales Decline, Okachi Says
Written by HMH | December 26, 2011 | 0 |
Natural rubber demand in China, the world’s largest consumer, may slow in 2012 and prices may extend the biggest annual decline in three years as economic growth and auto sales ease, an executive at Okachi & Co. said.
“There’s growing concern that the whole economic situation will face downward pressure in the first quarter next year because of weak economies in both emerging and developed countries,” said Lizhi Tang, president of Okachi’s greater China region. Okachi is the largest broker for rubber contracts on the Tokyo Commodity Exchange, he said.
Slower Chinese demand may extend a 33 percent decline in prices this year, the biggest drop since 2008, amid higher supply from producing countries including Thailand, and as the sovereign debt crisis in Europe deepens and growth in the U.S. slows.
“Growth in China’s demand for natural rubber next year is poised to slow down amid sluggish new auto sales,” Li Shiqiang, general manager at Sri Trang (Shanghai) Ltd. (STA), a unit of Thailand’s largest publicly traded rubber exporter, said in a phone interview on Dec. 22.
China’s economy will grow 8.5 percent next year, the least in 11 years, according to the Organization for Economic Cooperation and Development. Vehicle sales may rise by the least in 13 years in 2011, plunging from last year’s record 32 percent, according to the China Association of Automobile Manufacturers, as inflation, higher interest rates and the end of a two-year stimulus plan deter purchases.
The June-delivery contract advanced to as high as 281.5 yen a kilogram ($3,610 a ton), the highest level since Dec. 12, before trading at 278.5 yen on the Tokyo Commodity Exchange at 11:50 a.m. local time.
Tire Makers
“Chinese tire makers are confronting problems such as tight cash flow, declining sales, overcapacity, pressure to lower tire prices and consolidation,” Li at Sri Trang said. “Their situation will only improve if the whole economy turns up and the auto market recovers.”
Shares in Giti Tire Corp. (600182), China’s largest tiremaker, have dropped 30 percent this year in Shanghai and Double Coin Holdings (600623) has plunged 40 percent as auto sales have slowed. The benchmark Shanghai bourse has dropped 21 percent.
“Next year it’s likely that supply will outstrip demand because of a slowdown in the global economy and the subsequent weak demand from the auto and tire sectors,” He Yihua, a trading manager at Okachi, said in an e-mail.
The increasing use of substitute synthetic rubber will also lead to reduced use of the natural product, He said. Synthetic rubber may have reduced natural rubber consumption by about 545,000 tons in 2011, he said.
‘Weak Fundamentals’
“The weak fundamentals in the real estate market and other infrastructure sectors will also reduce the demand for tires in the logistics chain,” Sri Trang’s Li said. “So far there’s nothing to be optimistic about in 2012.”
China’s home prices posted their worst performance this year with more than half of the 70 biggest cities monitored in November recording declines after the government reiterated plans to maintain property curbs.
China’s inventory at bonded area in Qingdao, the country’s biggest spot rubber trading hub, climbed to record 270,000 tons to 280,000 tons last month, signallling sluggish demand, Okachi’s Tang said.
Natural rubber prices may fall further in the first quarter as the producing countries raise production, Tang said. Any “meaningful” rebound may appear in the second or the third quarter when producing countries may take measures to stem a decline in prices and a less restrictive monetary policy in China may stimulate the economy, Tang said.
December 24, 2011
The Malaysian rubber market is expected to be quiet next week as most of the players would stay on the sidelines due to the festive season and holiday, dealers said.
A dealer said rubber production, which has been hit by the uncertain weather condition, was expected to influence next week’s prices.
“The market is worried about the shortage situation,” she said.
For the week just-ended, the market was unstable on supply worries as most of the rubber producing countries faced the raining season.
The Malaysian Rubber Board’s official physical price for tyre-grade SMR 20 rose 26.5 sen to 1,053.5 sen a kg from 1,027 sen a week earlier, while latex-in-bulk fell 6.5 sen to 663.5 sen a kg from 670 sen previously.
The unofficial closing price for SMR 20 added 14.0 sen to 1,053.5 sen a kg from 1,039.5 sen on Friday while latex-in-bulk slipped six sen to 664 sen from 670.0 sen last week.
The Malaysia rubber market will be closed on Monday for the Christmas celebration. — Bernama
Synthetic rubber output down 10% in Sept
December 23, 2011
New Delhi, Dec 23 (PTI) Synthetic rubber output fell by 10 per cent to 8,421 tonne in September, while consumption declined by 3 per cent to 33,510 tonne, according to Rubber Board data.
In September last year, the production of synthetic rubber stood at 9,320 tonne and consumption at 34,480 tonne.
The consumption by the auto tyre industry also declined by 5 per cent to 24,010 tonne in September 2011, compared to 25,323 tonne in the year-ago period.
Synthetic rubber is mostly used in the manufacture of tyres in the country.
India”s synthetic rubber imports, however, rose by 7 per cent to 26,760 tonne in September this year from 25,025 tonne in the same period last year.
In the first half of the current fiscal, synthetic rubber production rose to 54,750 tonne from 53,231 tonne in the same period last fiscal, while consumption increased to 2,13,075 tonne from 2,01,625 tonne in the same period.
Similarly, auto tyre industry consumed 1,54,887 tonne in April-September 2011 as against 1,44,126 tonne in the same period of the previous year.
Likewise, the total imports in April-September in this fiscal rose to 1,73,490 tonnes from 1,51,435 tonne in the same period last fiscal.
The total stock of synthetic rubber in the country at the end of September, 2011 stood at 51,015 tonne.
Market on Dec 23: Spot rubber shows mixed trend
December 23, 2011
KOTTAYAM, DEC. 23:
Physical rubber prices showed a mixed mood on Friday. The market appeared to be in a holiday mood with only a couple of days to Christmas and hence most of the participants were reluctant to make any new commitments. The volumes were narrow.
Sheet rubber weakened to Rs 200 (201) a kg according to traders. The grade slipped to Rs 200.50 (201) a kg both at Kottayam and Kochi as quoted by the Rubber Board.
In futures, the January series improved to Rs 204.55 (202.86), February to Rs 206.50 (204.70), March to Rs 209.30 (207.36), April to Rs 213.90 (212.78) and May to Rs 214.50 (213.20) a kg on the National Multi Commodity Exchange (NMCE).
RSS 3 (spot) dropped to Rs 178.92 (179.15) a kg at Bangkok. The Tokyo Commodity Exchange remained closed owing to “The Emperor’s Birthday”.
Spot rates were (Rs/kg): RSS-4: 200 (201); RSS-5: 196 (196); ungraded: 190 (190); ISNR 20: 191 (190) and latex 60 per cent: 110 (110).
Rubber limps, but tyre makers smarting
December 24, 2011
Respite eludes the demand- and margin-deprived Indian tyre industry. As high import costs offset fall in raw material prices, tyre-makers are struggling to maintain their margins. Negative industry outlook is not exactly helping matters.
About 50% of industry’s inputs are currently imported. With the rupee weakening against the US dollar, the soaring import cost has emerged as the biggest concern, in contrast to this time last year, when rise in raw material prices unsettled the industry.
It appears the only silver lining in the past quarter has been the stable prices of raw materials, particularly of natural rubber.
Prices of rubber (which accounts for some 43% of total raw material costs) rose sharply in 2010-11, peaking in April at Rs240 per kg. They have, however, started to soften around Rs200 per kg now.
On the other hand, rupee has depreciated almost 20% since September. This is pressuring tyre-makers. And they are unable to pass on the pressure to others due to sluggish demand in the automobile industry.
“The depreciation of rupee has heavily impacted us. Whatever marginal gains we got due to the falling natural rubber prices has been nullified as our import cost shot up. Out of the total raw material used for making tyres, 50% is being imported currently,” said Ajay Sevekari, director, Bridgestone Tyres.
Uncertainty continues to dog the industry. The auto industry slowdown, particularly in the passenger car segment, has directly affected the tyre industry. Although the commercial vehicle (CV) segment is growing robustly, its after-market has slowed. All this has affected the pricing power of the major players in the industry.
“Despite steep increase in import cost, we are not in a position to absorb price hikes,” said Sevekari of Bridgestone.
“The demand in the (CV) after-market has dropped by 15% this year as compared to last year. Ban on mining in certain states has affected the after-market demand directly. All these factors do not allow us to take pricing action,” said Satish Sharma, chief, India operations, Apollo Tyres.
Till October in the current financial year, the tyre industry grew just about 6.5%. ATMA (All India Tyre Manufacturers’ Association) data suggest segments like passenger car tyres and CV tyres saw a dip in growth in September and October.
Many companies had focused on exports in order to offset weak domestic demand. Exports, however, seem to have taken a back seat now as domestic currencies of different countries are weakening.
“Export orders are currently kept on hold and payments are also coming. This has added to the concerns of tyre-makers. There is a lot of uncertainty and pressure in the market,” said
Rajiv Buddharaja, president, ATMA.
For tyre major Ceat, the year so far has been good on account of robust exports. “Our imports and exports are hedged. Till December(-end), we are comfortable as far as exports are concerned. Q4, however, looks tight as the (US) dollar is appreciating against many currencies. Exports can be a challenge going ahead,” said Arnab Banerjee, executive director – operations, Ceat.
Rubber Demand in China to Slow in 2012 as Auto Sales Decline, Okachi Says
Written by HMH | December 26, 2011 | 0 |
Natural rubber demand in China, the world’s largest consumer, may slow in 2012 and prices may extend the biggest annual decline in three years as economic growth and auto sales ease, an executive at Okachi & Co. said.
“There’s growing concern that the whole economic situation will face downward pressure in the first quarter next year because of weak economies in both emerging and developed countries,” said Lizhi Tang, president of Okachi’s greater China region. Okachi is the largest broker for rubber contracts on the Tokyo Commodity Exchange, he said.
Slower Chinese demand may extend a 33 percent decline in prices this year, the biggest drop since 2008, amid higher supply from producing countries including Thailand, and as the sovereign debt crisis in Europe deepens and growth in the U.S. slows.
“Growth in China’s demand for natural rubber next year is poised to slow down amid sluggish new auto sales,” Li Shiqiang, general manager at Sri Trang (Shanghai) Ltd. (STA), a unit of Thailand’s largest publicly traded rubber exporter, said in a phone interview on Dec. 22.
China’s economy will grow 8.5 percent next year, the least in 11 years, according to the Organization for Economic Cooperation and Development. Vehicle sales may rise by the least in 13 years in 2011, plunging from last year’s record 32 percent, according to the China Association of Automobile Manufacturers, as inflation, higher interest rates and the end of a two-year stimulus plan deter purchases.
The June-delivery contract advanced to as high as 281.5 yen a kilogram ($3,610 a ton), the highest level since Dec. 12, before trading at 278.5 yen on the Tokyo Commodity Exchange at 11:50 a.m. local time.
Tire Makers
“Chinese tire makers are confronting problems such as tight cash flow, declining sales, overcapacity, pressure to lower tire prices and consolidation,” Li at Sri Trang said. “Their situation will only improve if the whole economy turns up and the auto market recovers.”
Shares in Giti Tire Corp. (600182), China’s largest tiremaker, have dropped 30 percent this year in Shanghai and Double Coin Holdings (600623) has plunged 40 percent as auto sales have slowed. The benchmark Shanghai bourse has dropped 21 percent.
“Next year it’s likely that supply will outstrip demand because of a slowdown in the global economy and the subsequent weak demand from the auto and tire sectors,” He Yihua, a trading manager at Okachi, said in an e-mail.
The increasing use of substitute synthetic rubber will also lead to reduced use of the natural product, He said. Synthetic rubber may have reduced natural rubber consumption by about 545,000 tons in 2011, he said.
‘Weak Fundamentals’
“The weak fundamentals in the real estate market and other infrastructure sectors will also reduce the demand for tires in the logistics chain,” Sri Trang’s Li said. “So far there’s nothing to be optimistic about in 2012.”
China’s home prices posted their worst performance this year with more than half of the 70 biggest cities monitored in November recording declines after the government reiterated plans to maintain property curbs.
China’s inventory at bonded area in Qingdao, the country’s biggest spot rubber trading hub, climbed to record 270,000 tons to 280,000 tons last month, signallling sluggish demand, Okachi’s Tang said.
Natural rubber prices may fall further in the first quarter as the producing countries raise production, Tang said. Any “meaningful” rebound may appear in the second or the third quarter when producing countries may take measures to stem a decline in prices and a less restrictive monetary policy in China may stimulate the economy, Tang said.
Saturday, December 24, 2011
JK Tyre & Ind may see a decent upside, says Rajen Shah
JK Tyre & Ind may see a decent upside, says Rajen Shah
December 23, 2011
JK Tyre & Ind may see a decent upside, says Rajen Shah, CIO, Angel Broking.
Shah told CNBC-TV18, “Midcaps have been battered like they are never going to come up and there is lot of value in many companies. In tyre industry, what I have observed over the past three months all these companies whether it is Apollo Tyres , MRF , JK or Ceat, managements of these companies have been buying shares by creeping acquisition. The most aggressive has been Ceatand then we have JK, Apollo and MRF; a conservative management like MRF has started buying though small quantity 1000-1500-2000 shares but Ceat has been very aggressive. I think days of rubber and crude are number; rubber which was at Rs 240 a kg is down to about Rs 195-200 and I think its going to come down even further and on a sharp drop of 10-15% rubber could see this company’s bottomline zoom up.”
He further added, “One indication is that management buying itself is a good sign of confidence and rubber I personally believe that it should come down to about Rs 175-180 levels and I think that will see this company doing extra ordinarily good in 2012-13. The promising one which we feel amongst all this though Apollo is also reasonably fine at this point of time but we find lot of value in JK Tyres. If you see Apollo or MRF or these two companies the turnover this year would be 10,000 crore and they are at a market cap of about 3,000 crore so their market cap is 0.3 whereas if you see JK, the turnover this year will be 6,000 crore but the market cap is Rs 250 crore.”
“I was in Delhi about a month back and interacted with the management of JK and somehow I got the feeling that this company is quoting at 1/4th the replacement cost, they are setting up a plant in Chennai and pumping 930 crore where the market cap of JK itself is 250 crore and we too remind ourselves that two years back this very company reported about Rs 40-45 kind of earnings. So I don’t see any reason why this should not get repeated in 2013-14 when the Chennai plant will be fully operational. I think tyre industry certainly offers a decent upside.”
Market on Dec 23: Spot rubber shows mixed trend
December 23, 2011
KOTTAYAM, DEC. 23:
Physical rubber prices showed a mixed mood on Friday. The market appeared to be in a holiday mood with only a couple of days to Christmas and hence most of the participants were reluctant to make any new commitments. The volumes were narrow.
Sheet rubber weakened to Rs 200 (201) a kg according to traders. The grade slipped to Rs 200.50 (201) a kg both at Kottayam and Kochi as quoted by the Rubber Board.
In futures, the January series improved to Rs 204.55 (202.86), February to Rs 206.50 (204.70), March to Rs 209.30 (207.36), April to Rs 213.90 (212.78) and May to Rs 214.50 (213.20) a kg on the National Multi Commodity Exchange (NMCE).
RSS 3 (spot) dropped to Rs 178.92 (179.15) a kg at Bangkok. The Tokyo Commodity Exchange remained closed owing to “The Emperor’s Birthday”.
Spot rates were (Rs/kg): RSS-4: 200 (201); RSS-5: 196 (196); ungraded: 190 (190); ISNR 20: 191 (190) and latex 60 per cent: 110 (110).
December 23, 2011
JK Tyre & Ind may see a decent upside, says Rajen Shah, CIO, Angel Broking.
Shah told CNBC-TV18, “Midcaps have been battered like they are never going to come up and there is lot of value in many companies. In tyre industry, what I have observed over the past three months all these companies whether it is Apollo Tyres , MRF , JK or Ceat, managements of these companies have been buying shares by creeping acquisition. The most aggressive has been Ceatand then we have JK, Apollo and MRF; a conservative management like MRF has started buying though small quantity 1000-1500-2000 shares but Ceat has been very aggressive. I think days of rubber and crude are number; rubber which was at Rs 240 a kg is down to about Rs 195-200 and I think its going to come down even further and on a sharp drop of 10-15% rubber could see this company’s bottomline zoom up.”
He further added, “One indication is that management buying itself is a good sign of confidence and rubber I personally believe that it should come down to about Rs 175-180 levels and I think that will see this company doing extra ordinarily good in 2012-13. The promising one which we feel amongst all this though Apollo is also reasonably fine at this point of time but we find lot of value in JK Tyres. If you see Apollo or MRF or these two companies the turnover this year would be 10,000 crore and they are at a market cap of about 3,000 crore so their market cap is 0.3 whereas if you see JK, the turnover this year will be 6,000 crore but the market cap is Rs 250 crore.”
“I was in Delhi about a month back and interacted with the management of JK and somehow I got the feeling that this company is quoting at 1/4th the replacement cost, they are setting up a plant in Chennai and pumping 930 crore where the market cap of JK itself is 250 crore and we too remind ourselves that two years back this very company reported about Rs 40-45 kind of earnings. So I don’t see any reason why this should not get repeated in 2013-14 when the Chennai plant will be fully operational. I think tyre industry certainly offers a decent upside.”
Market on Dec 23: Spot rubber shows mixed trend
December 23, 2011
KOTTAYAM, DEC. 23:
Physical rubber prices showed a mixed mood on Friday. The market appeared to be in a holiday mood with only a couple of days to Christmas and hence most of the participants were reluctant to make any new commitments. The volumes were narrow.
Sheet rubber weakened to Rs 200 (201) a kg according to traders. The grade slipped to Rs 200.50 (201) a kg both at Kottayam and Kochi as quoted by the Rubber Board.
In futures, the January series improved to Rs 204.55 (202.86), February to Rs 206.50 (204.70), March to Rs 209.30 (207.36), April to Rs 213.90 (212.78) and May to Rs 214.50 (213.20) a kg on the National Multi Commodity Exchange (NMCE).
RSS 3 (spot) dropped to Rs 178.92 (179.15) a kg at Bangkok. The Tokyo Commodity Exchange remained closed owing to “The Emperor’s Birthday”.
Spot rates were (Rs/kg): RSS-4: 200 (201); RSS-5: 196 (196); ungraded: 190 (190); ISNR 20: 191 (190) and latex 60 per cent: 110 (110).
Friday, December 23, 2011
Strong new vehicle retail sales in 2011
Strong new vehicle retail sales in 2011
December 22, 2011
Good news for new vehicle retail sales. Consistent with their performance in November, 2011, new-vehicle retail sales continue to show strength.
According to a monthly sales forecast developed by J.D. Power and Associates Power Information Network (PIN) and LMC Automotive, December new-vehicle retail sales are projected to come in at 1,033,700 units. That is the first time retail sales will top 1 million units since the Cash for Clunkers program drove strong sales in August, 2009.
This volume represents a seasonally adjusted annualized rate (SAAR) of 11.2 million units. The company says Retail transactions are the most accurate measurement of true underlying consumer demand for new vehicles.
“Retail light-vehicle sales in December are performing well month-to-date, even as total incentive spending averages $2,700, down 10% from December 2010,” says John Humphrey, senior vice president of global automotive operations at J.D. Power and Associates. “The industry has managed through another series of external shocks and is in a healthier position as the year closes.”
With December sales tracking as expected, LMC Automotive is holding its 2011 forecast at 10.3 million units for retail light-vehicle sales and 12.7 million units for total light-vehicle sales. LMC Automotive’s forecast for 2012 remains at 13.8 million units for total light-vehicle sales, but has been adjusted slightly upward to 11.3 million units (from 11.2 million units) for retail light-vehicle sales.
“For the third straight time, light-vehicle sales are posting strong selling rates at the close of the year,” said Jeff Schuster, senior vice president of forecasting at LMC Automotive. “Next year, the automotive industry will look to build upon the strong finish to 2011, but the real test in 2012 will be weathering a summer selling slowdown and posting a full year of a progressive recovery.”
India: Rubber Board head sees India FY12 demand below estimate
December 22, 2011
By Shilpa Sharma and Fatema Khokhar
MUMBAI – India’s rubber demand in 2011-12 (Apr-Mar) is likely to be lower: than the 977,000 tn estimated at the beginning of this financial year due to slowdown in the country’s economic and manufacturing growth, said Rubber Board of India Chairman Sheela Thomas.
“Consumption of rubber has been sluggish from August and is below the projected levels,” Thomas told NewsWire18 in an interview. In the first eight months of this financial year, the country’s average monthly consumption was 79,076.87 tn, lower than the projected 81,416.66 tn, she said.
Rubber is used extensively in automobiles, footwear, machinery and automobile spare parts industries.
India’s Apr-Nov consumption was 632,615 tn, up slightly from a year ago, showed data from the Rubber Board. In 2010-11, the country consumed 947,715 tn rubber.
High interest rates and surging raw material prices have slowed India’s industrial growth in the past few months. In October, the Index of Industrial Production contracted by 5.1%–its worst performance in more than two-and-a-half years–due to slowdown in capital goods, manufacturing, mining, and intermediate goods sectors. In the same month the previous year, industrial output growth was 11.3%.
Demand for rubber from sectors such as automobiles is likely to suffer.
The tyre industry is the biggest consumer of the commodity.
Recently, the Society of Indian Automobile Manufacturers said growth in vehicles sales is expected to remain almost flat this financial year. In October, the automobiles industry body cut its estimate of 2011-12 domestic car sales growth to 2-4% from 16-18% earlier.
Outlook on global demand is no better due to uncertainty in developed economies, Thomas said.
“World rubber consumption during Jan-Sep rose only 2.1% while in the previous year, the global consumption growth was 15.5% as markets were coming back from recession,” she said..
PRODUCTION OUTLOOK
India’s rubber output this financial year is seen rising 4.6% from the previous year to 902,000 tn as plantation area has increased nearly 4.0%, Thomas said. The output would have been higher if Kerala had not received heavy rainfall this monsoon season, she said.
During Apr-Nov, India produced 575,100 tn natural rubber, higher than 548,150 tn a year ago.
With more area coming under rubber plantation and good progress of re-plantation work, tapping is expected to increase this year, she said.
Area under rubber is seen rising to 737,000 ha in 2011-12 from 711,560 ha a year ago. The commercial life of a rubber tree is 32 years, including growth phase of seven years.
“We have taken extensive collaboration (with rubber growers) in northeast, Karnataka, Goa, Odisha, Maharashtra, West Bengal and Andhra Pradesh in order to increase rubber plantation in the country,” Thomas said.
Kerala and Tamil Nadu are the two major rubber producers of India. “We are hopeful of meeting the output target (of 902,000 tn) as January is our peak production time,” she said.
Production would rise in the coming months as the weather would be suitable for tapping, she said.
RUBBER EXPORTS
Despite the weakness in the rupee against the US dollar, India is not expected to export significant quantity of rubber this year as domestic prices are higher than international prices, Thomas said. “In Apr-Nov, we exported 20,784 tn rubber and have a target of 50,000 tn for the financial year 2011-12. But we may not be able to achieve it as our prices are higher.”
India exports rubber mainly in the form of latex, sheet, and block.
On Dec 14, the price of the RSS-4 grade rubber was 201 rupees a kg in the domestic market, higher than 181.77 rupees for a similar grade in the international market, she said.
Indian prices are higher despite the depreciation in the rupee against the US dollar, which makes the commodity cheaper for international buyers.
At 1225 IST, the Indian currency was at 52.6700 rupees a dollar. On Thursday, the local unit had hit a record low of 54.2925 rupees a dollar.
Thomas said the main reason for international prices being low is lower demand from China. Domestic consumption is nearly flat from the previous year, which has kept local prices firm. China is the world’s largest consumer of natural rubber.
International rubber prices came under pressure also because of the recent floods in Thailand, which disrupted car production in Asia and North
America, lowering demand for rubber. Besides, the debt crisis in Europe weighed on sentiment.Domestic prices are getting support also from expectations carryover stocks will be low, Thomas said. At the end of this financial year, the country’s carryover stocks are seen around 230,000 tn, down from 272,000 tn a year ago, she said.
Source: Geojit Comtrade Ltd
December 22, 2011
Good news for new vehicle retail sales. Consistent with their performance in November, 2011, new-vehicle retail sales continue to show strength.
According to a monthly sales forecast developed by J.D. Power and Associates Power Information Network (PIN) and LMC Automotive, December new-vehicle retail sales are projected to come in at 1,033,700 units. That is the first time retail sales will top 1 million units since the Cash for Clunkers program drove strong sales in August, 2009.
This volume represents a seasonally adjusted annualized rate (SAAR) of 11.2 million units. The company says Retail transactions are the most accurate measurement of true underlying consumer demand for new vehicles.
“Retail light-vehicle sales in December are performing well month-to-date, even as total incentive spending averages $2,700, down 10% from December 2010,” says John Humphrey, senior vice president of global automotive operations at J.D. Power and Associates. “The industry has managed through another series of external shocks and is in a healthier position as the year closes.”
With December sales tracking as expected, LMC Automotive is holding its 2011 forecast at 10.3 million units for retail light-vehicle sales and 12.7 million units for total light-vehicle sales. LMC Automotive’s forecast for 2012 remains at 13.8 million units for total light-vehicle sales, but has been adjusted slightly upward to 11.3 million units (from 11.2 million units) for retail light-vehicle sales.
“For the third straight time, light-vehicle sales are posting strong selling rates at the close of the year,” said Jeff Schuster, senior vice president of forecasting at LMC Automotive. “Next year, the automotive industry will look to build upon the strong finish to 2011, but the real test in 2012 will be weathering a summer selling slowdown and posting a full year of a progressive recovery.”
India: Rubber Board head sees India FY12 demand below estimate
December 22, 2011
By Shilpa Sharma and Fatema Khokhar
MUMBAI – India’s rubber demand in 2011-12 (Apr-Mar) is likely to be lower: than the 977,000 tn estimated at the beginning of this financial year due to slowdown in the country’s economic and manufacturing growth, said Rubber Board of India Chairman Sheela Thomas.
“Consumption of rubber has been sluggish from August and is below the projected levels,” Thomas told NewsWire18 in an interview. In the first eight months of this financial year, the country’s average monthly consumption was 79,076.87 tn, lower than the projected 81,416.66 tn, she said.
Rubber is used extensively in automobiles, footwear, machinery and automobile spare parts industries.
India’s Apr-Nov consumption was 632,615 tn, up slightly from a year ago, showed data from the Rubber Board. In 2010-11, the country consumed 947,715 tn rubber.
High interest rates and surging raw material prices have slowed India’s industrial growth in the past few months. In October, the Index of Industrial Production contracted by 5.1%–its worst performance in more than two-and-a-half years–due to slowdown in capital goods, manufacturing, mining, and intermediate goods sectors. In the same month the previous year, industrial output growth was 11.3%.
Demand for rubber from sectors such as automobiles is likely to suffer.
The tyre industry is the biggest consumer of the commodity.
Recently, the Society of Indian Automobile Manufacturers said growth in vehicles sales is expected to remain almost flat this financial year. In October, the automobiles industry body cut its estimate of 2011-12 domestic car sales growth to 2-4% from 16-18% earlier.
Outlook on global demand is no better due to uncertainty in developed economies, Thomas said.
“World rubber consumption during Jan-Sep rose only 2.1% while in the previous year, the global consumption growth was 15.5% as markets were coming back from recession,” she said..
PRODUCTION OUTLOOK
India’s rubber output this financial year is seen rising 4.6% from the previous year to 902,000 tn as plantation area has increased nearly 4.0%, Thomas said. The output would have been higher if Kerala had not received heavy rainfall this monsoon season, she said.
During Apr-Nov, India produced 575,100 tn natural rubber, higher than 548,150 tn a year ago.
With more area coming under rubber plantation and good progress of re-plantation work, tapping is expected to increase this year, she said.
Area under rubber is seen rising to 737,000 ha in 2011-12 from 711,560 ha a year ago. The commercial life of a rubber tree is 32 years, including growth phase of seven years.
“We have taken extensive collaboration (with rubber growers) in northeast, Karnataka, Goa, Odisha, Maharashtra, West Bengal and Andhra Pradesh in order to increase rubber plantation in the country,” Thomas said.
Kerala and Tamil Nadu are the two major rubber producers of India. “We are hopeful of meeting the output target (of 902,000 tn) as January is our peak production time,” she said.
Production would rise in the coming months as the weather would be suitable for tapping, she said.
RUBBER EXPORTS
Despite the weakness in the rupee against the US dollar, India is not expected to export significant quantity of rubber this year as domestic prices are higher than international prices, Thomas said. “In Apr-Nov, we exported 20,784 tn rubber and have a target of 50,000 tn for the financial year 2011-12. But we may not be able to achieve it as our prices are higher.”
India exports rubber mainly in the form of latex, sheet, and block.
On Dec 14, the price of the RSS-4 grade rubber was 201 rupees a kg in the domestic market, higher than 181.77 rupees for a similar grade in the international market, she said.
Indian prices are higher despite the depreciation in the rupee against the US dollar, which makes the commodity cheaper for international buyers.
At 1225 IST, the Indian currency was at 52.6700 rupees a dollar. On Thursday, the local unit had hit a record low of 54.2925 rupees a dollar.
Thomas said the main reason for international prices being low is lower demand from China. Domestic consumption is nearly flat from the previous year, which has kept local prices firm. China is the world’s largest consumer of natural rubber.
International rubber prices came under pressure also because of the recent floods in Thailand, which disrupted car production in Asia and North
America, lowering demand for rubber. Besides, the debt crisis in Europe weighed on sentiment.Domestic prices are getting support also from expectations carryover stocks will be low, Thomas said. At the end of this financial year, the country’s carryover stocks are seen around 230,000 tn, down from 272,000 tn a year ago, she said.
Source: Geojit Comtrade Ltd
Tuesday, December 20, 2011
OUTLOOK-India rubber seen down on imports, global cues
OUTLOOK-India rubber seen down on imports, global cues
December 19, 2011
MUMBAI, Dec 19 (Reuters) – Natural rubber prices in India are likely to ease this week tracking a fall in the world market and as local tyre makers decrease dependence on the domestic market, dealers and analysts said.
At 4:57 p.m. on Tuesday, the benchmark January rubber on India’s National Multi-Commodity Exchange (NMCE) was 0.5 percent up at 20,325 rupees per 100 kg.
The price of the most traded RSS-4 rubber (ribbed, smoked sheet) in the key Kottayam market in Kerala rose 50 rupees to 20,050 rupees per 100 kg.
Spot price in Bangkok, Thailand, declined 461 rupees to 17,718 rupees.
“The drop in world market is depressing local prices. Due to the fall, tyre makers have been importing higher amount of rubber,” said a member of Indian Rubber Dealers’ Federation (IRDF).
India’s natural rubber imports edged up 4.6 percent in November to 15,069 tonnes, the state-run Rubber Board said on Dec. 9, and steep price fall in overseas markets is likely to continue to make imports attractive for tyre makers.
The country’s production during the month rose 4.3 percent on a year ago to 94,400 tonnes, while consumption was 82,000 tonnes compared with 78,010 tonnes a year ago, it said.
India, the world’s fourth biggest producer, imports natural rubber from Thailand, Indonesia, Malaysia and Vietnam.
Tokyo rubber futures ended 1.4 percent lower on Monday, weighed down by worries that Europe’s debt crisis could trim demand plus a drop in oil prices, dealers said.
“Supply situation is very comfortable in the local market. It’s peak tapping season. Arrivals are adequate, despite holding by some farmers,” the member said.
Rubber production in India peaks during Oct-Jan.
India’s tyre output growth is likely to almost halve in the fiscal year ending March 2012 to 12 percent, as vehicle sales slowed because of higher interest rates, hitting demand from automakers, a senior industry official said on Sept. 9.
Thai 2012 rubber output seen up 5%
December 20, 2011
BANGKOK: Thailand expected production of around 3.15 million tonnes of rubber in 2012, about 5% more than the three million forecast for 2011, the head of the country’s rubber exporters’ association said.
“It rained a lot this year and we may face a lot of rain again, so we expect a minimal rise of around 5% in production,” Pongsak Kerdwongbundit, president of the Thai Rubber Association, told Reuters. – Reuters
Spot rubber rules steady
KOTTAYAM, DEC. 19:
Spot rubber closed almost steady on Monday. The only gainer was RSS 4 which improved marginally on covering purchases at lower levels. The reports from the global scene were also not promising. The transactions continued to be meagre.
During last week, NR prices edged lower weighed by increased imports and subdued demand from major consuming industries, analysts said. However, a mild recovery from the two weeks low was witnessed by weekend though the gains were limited on buyer resistance.
Sheet rubber improved to Rs 201 (199.50) a kg according to traders. The grade increased to Rs 200.50 (200) a kg both at Kottayam and Kochi as per Rubber Board.
In futures, the January series closed at Rs 203.45 (202.18), February at Rs 205.45 (204.22), March at Rs 208.49 (207.39), April at Rs 213 (212.40) and May at Rs 214.40 (213.83) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 (spot) dropped to Rs 177.18 (181.79) a kg at Bangkok. The December futures for the grade weakened to ¥250 (Rs 169.70) from ¥253.4 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: 201 (199.50); RSS-5: 197 (197); ungraded: 190 (190); ISNR 20: 187.50 (187.50) and latex 60 per cent: 110 (110).
Now is the time to buy a petrol car
Petrol car demand to get a boost if diesel vehicle excise is hiked
Make diesel cars dearer
NEW DELHI, DEC. 19:
Its raining discounts and freebies on petrol cars this month as companies look to buck the ‘model year' syndrome and clear rising stocks. Diesel cars, however, are not being incentivised by most as the demand for such models still continues to outstrip supply.
THE YEAR-END FACTOR
Most companies try to incentivise sales in December every year as it is felt that buyers generally prefer not to buy cars in the last month and wait till January for purchases.
By waiting a month, the date of registration of the vehicle would be for the next year, giving them a higher price upon resale. This leads to a sharp drop in December sales for most manufacturers.
An up to Rs 64,000 lower price benefit is available on new petrol cars starting from the compact segment from carmakers such as General Motors, Maruti Suzuki, Hyundai and Honda. This is part of a combined offer, which includes free insurance and maintenance, freebies and other benefits such as a loyalty bonus.
“Petrol versions have higher discounts because manufacturers want to clear inventory. We have been giving offers since October,” Mr P. Balendran, Vice-President at General Motors India (GMI), told Business Line.
“Our December sales are expected to be at best similar to November. We should see an upward movement only around April-May, depending on the Budget proposals and with other enablers such as interest rates in place,” said Mr Balendran.
Mr Abdul Majeed, Partner at PwC, added, “After the festival season, sales dip in December, plus with new launches coming next year, it makes sense to clear off inventories now.”
WHAT'S ON OFFER
GMI is offering discount in the Rs 33,000 (Beat) to Rs 64,000 (Spark) range across nearly all of its petrol models. Interestingly, the highest discount is on the cheapest car in its portfolio. Honda Siel is offering freebies like a GPS system for the Civic and Accord sedans.
Only for December, Hyundai is offering Rs 50,000 off on the i10 hatch, Rs 34,000 on the Santro and Rs 10,000 on the Verna petrol. This includes an exchange offer. “The best offers are on right now, but diesels have no discount. Wholesales in December will be lower than last month, though retail should be good,” Mr Arvind Saxena, Director of Marketing and Sales, Hyundai Motor India said.
MARUTI'S DECEMBER
A departure form the rest, Maruti Suzuki, felt that December sales could be one of the highest in the year after March. The leading carmaker is also offering higher discounts on petrol cars over other months.
“It's a myth that December sees lower sales, as has been proved by six out of the last seven years. Higher discounts offered and rumours of price hikes in January tend to push customers to buy in December,” said Mr Shashank Srivastava, Chief General Manager of Marketing, Maruti Suzuki.
Maruti's sales are expected to rise this month as it looks to service a large order backlog accumulating over the last many months. Its Manesar plant has just managed to normalise operations after a series of three labour strikes this year.
December 19, 2011
MUMBAI, Dec 19 (Reuters) – Natural rubber prices in India are likely to ease this week tracking a fall in the world market and as local tyre makers decrease dependence on the domestic market, dealers and analysts said.
At 4:57 p.m. on Tuesday, the benchmark January rubber on India’s National Multi-Commodity Exchange (NMCE) was 0.5 percent up at 20,325 rupees per 100 kg.
The price of the most traded RSS-4 rubber (ribbed, smoked sheet) in the key Kottayam market in Kerala rose 50 rupees to 20,050 rupees per 100 kg.
Spot price in Bangkok, Thailand, declined 461 rupees to 17,718 rupees.
“The drop in world market is depressing local prices. Due to the fall, tyre makers have been importing higher amount of rubber,” said a member of Indian Rubber Dealers’ Federation (IRDF).
India’s natural rubber imports edged up 4.6 percent in November to 15,069 tonnes, the state-run Rubber Board said on Dec. 9, and steep price fall in overseas markets is likely to continue to make imports attractive for tyre makers.
The country’s production during the month rose 4.3 percent on a year ago to 94,400 tonnes, while consumption was 82,000 tonnes compared with 78,010 tonnes a year ago, it said.
India, the world’s fourth biggest producer, imports natural rubber from Thailand, Indonesia, Malaysia and Vietnam.
Tokyo rubber futures ended 1.4 percent lower on Monday, weighed down by worries that Europe’s debt crisis could trim demand plus a drop in oil prices, dealers said.
“Supply situation is very comfortable in the local market. It’s peak tapping season. Arrivals are adequate, despite holding by some farmers,” the member said.
Rubber production in India peaks during Oct-Jan.
India’s tyre output growth is likely to almost halve in the fiscal year ending March 2012 to 12 percent, as vehicle sales slowed because of higher interest rates, hitting demand from automakers, a senior industry official said on Sept. 9.
Thai 2012 rubber output seen up 5%
December 20, 2011
BANGKOK: Thailand expected production of around 3.15 million tonnes of rubber in 2012, about 5% more than the three million forecast for 2011, the head of the country’s rubber exporters’ association said.
“It rained a lot this year and we may face a lot of rain again, so we expect a minimal rise of around 5% in production,” Pongsak Kerdwongbundit, president of the Thai Rubber Association, told Reuters. – Reuters
Spot rubber rules steady
KOTTAYAM, DEC. 19:
Spot rubber closed almost steady on Monday. The only gainer was RSS 4 which improved marginally on covering purchases at lower levels. The reports from the global scene were also not promising. The transactions continued to be meagre.
During last week, NR prices edged lower weighed by increased imports and subdued demand from major consuming industries, analysts said. However, a mild recovery from the two weeks low was witnessed by weekend though the gains were limited on buyer resistance.
Sheet rubber improved to Rs 201 (199.50) a kg according to traders. The grade increased to Rs 200.50 (200) a kg both at Kottayam and Kochi as per Rubber Board.
In futures, the January series closed at Rs 203.45 (202.18), February at Rs 205.45 (204.22), March at Rs 208.49 (207.39), April at Rs 213 (212.40) and May at Rs 214.40 (213.83) a kg for RSS 4 on the National Multi Commodity Exchange.
RSS 3 (spot) dropped to Rs 177.18 (181.79) a kg at Bangkok. The December futures for the grade weakened to ¥250 (Rs 169.70) from ¥253.4 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: 201 (199.50); RSS-5: 197 (197); ungraded: 190 (190); ISNR 20: 187.50 (187.50) and latex 60 per cent: 110 (110).
Now is the time to buy a petrol car
Petrol car demand to get a boost if diesel vehicle excise is hiked
Make diesel cars dearer
NEW DELHI, DEC. 19:
Its raining discounts and freebies on petrol cars this month as companies look to buck the ‘model year' syndrome and clear rising stocks. Diesel cars, however, are not being incentivised by most as the demand for such models still continues to outstrip supply.
THE YEAR-END FACTOR
Most companies try to incentivise sales in December every year as it is felt that buyers generally prefer not to buy cars in the last month and wait till January for purchases.
By waiting a month, the date of registration of the vehicle would be for the next year, giving them a higher price upon resale. This leads to a sharp drop in December sales for most manufacturers.
An up to Rs 64,000 lower price benefit is available on new petrol cars starting from the compact segment from carmakers such as General Motors, Maruti Suzuki, Hyundai and Honda. This is part of a combined offer, which includes free insurance and maintenance, freebies and other benefits such as a loyalty bonus.
“Petrol versions have higher discounts because manufacturers want to clear inventory. We have been giving offers since October,” Mr P. Balendran, Vice-President at General Motors India (GMI), told Business Line.
“Our December sales are expected to be at best similar to November. We should see an upward movement only around April-May, depending on the Budget proposals and with other enablers such as interest rates in place,” said Mr Balendran.
Mr Abdul Majeed, Partner at PwC, added, “After the festival season, sales dip in December, plus with new launches coming next year, it makes sense to clear off inventories now.”
WHAT'S ON OFFER
GMI is offering discount in the Rs 33,000 (Beat) to Rs 64,000 (Spark) range across nearly all of its petrol models. Interestingly, the highest discount is on the cheapest car in its portfolio. Honda Siel is offering freebies like a GPS system for the Civic and Accord sedans.
Only for December, Hyundai is offering Rs 50,000 off on the i10 hatch, Rs 34,000 on the Santro and Rs 10,000 on the Verna petrol. This includes an exchange offer. “The best offers are on right now, but diesels have no discount. Wholesales in December will be lower than last month, though retail should be good,” Mr Arvind Saxena, Director of Marketing and Sales, Hyundai Motor India said.
MARUTI'S DECEMBER
A departure form the rest, Maruti Suzuki, felt that December sales could be one of the highest in the year after March. The leading carmaker is also offering higher discounts on petrol cars over other months.
“It's a myth that December sees lower sales, as has been proved by six out of the last seven years. Higher discounts offered and rumours of price hikes in January tend to push customers to buy in December,” said Mr Shashank Srivastava, Chief General Manager of Marketing, Maruti Suzuki.
Maruti's sales are expected to rise this month as it looks to service a large order backlog accumulating over the last many months. Its Manesar plant has just managed to normalise operations after a series of three labour strikes this year.
Wednesday, December 14, 2011
Tokyo futures end 1 pct lower, euro debt worries linger
Tokyo futures end 1 pct lower, euro debt worries linger
December 13, 2011
SINGAPORE, Dec 13 (Reuters) – Tokyo rubber futures extended losses on Tuesday as equities and other commodities fell after a European Union summit aimed at solving the region’s deteriorating debt crisis failed to restore financial market confidence. Stocks in Asia plunged and the euro languished near a two-month low as investors took fright at the prospect of mass euro zone sovereign ratings downgrades after the outcome of a “last chance” EU summit was unable to convince markets. The most active Tokyo Commodity Exchange rubber contract for May delivery ended 2.8 yen a kg lower at 274.6 yen after hitting an intraday low at 272.2 yen. The contract plunged to a near 2-year low of around 248 yen in November.
“For this week, I think the concern is more on the European debt crisis. Rubber is more likely to track macroeconomics changes,” said Ker Chung Yang, analyst at Phillip Futures in Singapore. “Coming to the year-end, I would expect the physical market to go quieter,” said Ker, who pegged support levels at 248 and 250 yen.
In the physical market, Indonesia’s SIR20 tyre grade changed hands at 154.50 U.S. cents a pound ($3.41 a kg) for February shipment. Offers were limited in Southeast Asia after a combination of dry and wet weather curbed supply in Thailand, Indonesia and Malaysia. The Indonesia Commodity & Derivative Exchange (ICDX) is planning to launch a physical rubber contract following talks with the International Tripartite Rubber Council, but timescale and details had yet to be decided. In other commodities, gold fell to its lowest in seven weeks, London copper extended losses, while Brent crude was little changed after falling in the previous session on worries that last week’s pact by European leaders may not be enough to limit the region’s debt crisis.
Major rubber growers may back physical market in benchmark drive
December 12, 2011
AKARTA: Thailand, Indonesia and Malaysia, which account for about 70% of natural-rubber output, plan to set up a regional physical market to create a new benchmark for the commodity, according to a trade group.
The market would help producers trade with more transparent and reliable prices, Tjahjono Budiarto Tjandra, chairman of the Committee on Strategic Market Operations at the International Rubber Consortium, said in an interview in Bali on Monday.
The countries agreed to take “specific measures” to support prices, Bayu Krisnamurthi, Indonesia’s deputy trade minister, told reporters in Bali after a meeting of representatives from the three governments. Rubber has slumped in Tokyo this year as Europe’s debt crisis raised concern that demand may drop.
The Tokyo Commodity Exchange, which trades that benchmark, is tracking the contract plan. The initiative may involve the Indonesia Commodity & Derivatives Exchange, the Agricultural Futures Exchange of Thailand and the Malaysia Derivatives Exchange, Tjandra said.
“We’re ready to start the rubber contract next year,” Megain Widjaja, chief executive officer of the Indonesia Commodity & Derivatives Exchange, or ICDX, said in an interview. The three Southeast Asian exchanges and the consortium met in Phuket, Thailand last month to discuss the plan, Widjaja said.
“Although the current rubber price has declined from early 2011, it is still quite high,” Bayu said. “We must be ready for any situation that may further pressure the price.” Rubber futures in Tokyo are set for their worst annual performance since 2008, when the global economic recession reduced demand.
The contract for delivery in May closed at 277.4 yen per kg on Tocom on Monday. “We will closely watch the development of the issue,” said Fuminori Kondo, a spokesman for Tocom.
“We’ve heard similar ideas before. As the three producing countries represent 70% of global rubber output, the idea is interesting to us as our bourse trades rubber futures.”The Agricultural Futures Exchange of Thailand welcomed the rubber plan, which merits further study, according to Chairman Prasat Kesawapitak.
“The initiative also needs support from the government to help stabilize the price.” The International Tripartite Rubber Council - which represents growers and exporters from Thailand, Indonesia and Malaysia – last month encouraged members to blacklist buyers who default on purchases. Members may curb exports if necessary to limit supply and boost prices, the group said on November 19.
“There’s a desire from the governments of the three countries to set up a market as soon as possible that would be based on the real supply-and-demand fundamentals,” said Tjandra from the consortium, which represents growers and exporters from Thailand, Indonesia and Malaysia. The contract would most likely trade in dollars, he said.
Market on Dec 12: Spot rubber rules steady
December 12, 2011
KOTTAYAM, DEC. 12:
Spot rubber continued to rule unchanged on Monday. Sentiments were almost neutral following a weak closing in domestic futures on the National Multi Commodity Exchange (NMCE).
According to sources, the market remained under pressure on comparatively higher imports and slightly increased supplies above the Rs 200-mark. Imports showed a rise of almost five per cent in November, while exports went up to 580 tonnes compared with 60 tonnes during the same period last year, they added.
Sheet rubber finished steady at Rs 202 a kg, according to traders. It was flat at Rs 201.50 a kg both at Kottayam and Kochi, as reported by the Rubber Board.
In futures, the December series slipped to Rs 201.20 (202.98), January to Rs 202.50 (205.01), February to Rs 204.50 (207.19), March to Rs 207.65 (209.75), April to Rs 211.51 (214.63) and May to Rs 213.51 (216.50) a kg for RSS 4 on the NMCE.
The December futures increased to ¥263.4 (Rs 178.28) from ¥260.3 a kg during the day session but then dropped to ¥260 (Rs 176.01) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 202 (202); RSS-5: 199 (199); ungraded: 193 (193); ISNR 20: 189 (189) and latex 60 per cent: 111 (110).
India: Natural rubber demand-supply gap narrows
December 13, 2011
The gap between production and consumption of natural rubber (NR) narrowed in November. Though consumption grew at a much lower pace than production, the gap at November-end fell to 57,515 tonnes from 70,725 tonnes in April-October.
During April-November, consumption increased 0.7 per cent due to the economic slowdown and the euro zone crisis, while production increased 4.9 per cent. Still, there was a marginal increase of 0.2 per cent in the cumulative consumption in April-October.
Average consumption during April-November increased to 632,615 tonnes, as against 628,240 tonnes in the same period of the last financial year. According to provisional figures of the Rubber Board, total production increased 4.9 per cent to 575,100 tonnes as against 548,150 tonnes.
Production of NR in November increased 4.3 per cent to 94,400 tonnes compared to 90,500 tonnes during November 2010. Monthly consumption increased seven per cent to 82,000 tonnes compared to 78,010 tonnes.
Tyre sector hit
Most tyre companies in India are facing severe problems on the demand side, due to low automobile sales. This caused a drastic reduction in the demand from the original equipment (OE) segment for the last few months. Industry sources said the improvement is not an indication of better status of rubber-based industries.
Leading rubber dealer and former president of the Cochin Rubber Merchants Association, N Radhakrish-nan said tyre production had picked up pace marginally, but the non-tyre sector was still under pressure. The slight increase in consumption is because of the improvement in tyre production.
Tyre companies are buying rubber as prices are comparatively low now. But, the crisis of small and medium non-tyre units is continuing and a large number are on the verge of closure, he said. According to information from the All-India Rubber Industries Association, 500 such units have shut shop.
According to Rajiv Budh-raja, director general, Autom-otive Tyre Manufacturers’ Association, the slowdown in the tyre sector continues. Tyre production increased seven per cent in April-October as against a double-digit increase in the same period last year. The production of truck/bus tyres was flat, while car tyre output increased three per cent. Radhakrishnan said prices would move on a steady note as rich farmers are holding stock for better price realisation. Also, global supply is low due to poor production in Thailand, the world’s largest NR producer, due to rain and floods. Supply is expected to fall 5.6 per cent in 2011.
Import, exports
Though the local market is not having enough rubber and the prices abroad are lower than in India, imports have declined in the current year. Total imports during April-November were 111,899 tonnes as against 152,658 tonnes in the same period of last year.
Meanwhile, exports were up 430 per cent to 20,784 tonnes as against 4,798 tonnes in the same period last year.
India rubber seen steady on supply, rupee
December 13, 2011
Dec 13 (Reuters) – Natural rubber prices in India are likely to tread water this week due to steady supplies and as a depreciating Indian rupee is nullifying the benefit of buying from overseas markets, analysts said.
At 3:35 p.m on Tuesday, the benchmark January rubber on India’s National Multi-Commodity Exchange (NMCE) was 0.1 percent down at 20,249 rupees per 100 kg.
The price of the most traded RSS-4 rubber (ribbed, smoked sheet) in the key Kochi market in Kerala fell 103 rupees to 20,067 rupees per 100 kg.
Spot price in Bangkok, Thailand, was 18,025 rupees on Tuesday.
“Taping is going on in full swing, but it is not materialising in rubber supplies in the same proportion. Supplies are steady,” said Jose Mambarambil, vice-president at Indian Rubber Dealers’ Federation (IRDF).
“Farmers are storing latex in drums after tapping. Due to labour shortage, they are finding it difficult to make rubber sheets. Besides, many farmers are holding supplies hoping prices will rise after January,” he said.
Rubber production in India peaks during Oct-Jan.
Tyre makers were aggressively signing import deals but pace may falter in coming weeks due to a weak rupee, Mambarambil said.
India’s natural rubber imports edged up 4.6 percent in November to 15,069 tonnes, the state-run Rubber Board said on Dec. 9, and steep price fall in overseas markets is likely to continue to make imports attractive for tyre makers.
The country’s production during the month rose 4.3 percent on a year ago to 94,400 tonnes, while consumption was 82,000 tonnes compared with 78,010 tonnes a year ago, it said.
India, the world’s fourth biggest producer, imports natural rubber from Thailand, Indonesia, Malaysia and Vietnam.
Tokyo rubber futures extended losses on Tuesday as equities and other commodities fell after a European Union summit aimed at solving the region’s deteriorating debt crisis failed to restore financial market confidence.
The Indian rupee slumped to an all-time low of 53.52 to the dollar on Tuesday.
India’s tyre output growth is likely to almost halve in the fiscal year ending March 2012 to 12 percent, as vehicle sales slowed because of higher interest rates, hitting demand from automakers, a senior industry official said on Sept. 9.
The country’s production for the current financial year is estimated at 902,000 tonnes and consumption at 977,000 tonnes. (Reporting by Rajendra Jadhav; Editing by Rajesh Pandathil)
India: CM pushing for a hike in subsidy for rubber growers
December 14, 2011
KOTTAYAM: Support for Rubber Producers Societies (RPS) from local self-government bodies and panchayats was under the consideration of the state government, chief minister Oommen Chandy said here on Tuesday. He was inaugurating the year-long silver jubilee celebrations of RPS at the Mammen Mappilai Hall. here.
“The government is seriously considering giving support to RPS from a share of project funds,” he said. He also said that the Planning Board had taken a decision regarding that in 2005 but an approval did not come from the government then. “Now the matter is back with the Planning Board,” he said. Higher Subsidy
Chandy said that his government had brought the issues faced by rubber planters to the attention of the central government. “The most important recommendation is about the subsidy given for replanting of rubber. This amount was fixed years ago and is still the same. Considering the expenses connected with farming these days, that amount is meagre. The Rubber Board has recommended increase of the subsidy to Rs 50,000. The state government has requested the Centre to consider this demand of the board as one from the state itself,” said Chandy.
He said that the agricultural sector was the strength of the state and rubber occupied a prominent place in it. He lauded the Rubber Board for playing an active role in achieving that place. Revenue minister Thiruvanchoor Radhakrishnan presided over the function. Sheela Thomas IAS, chairman, Rubber Board, welcomed the gathering.
The chief minister presented the Suvarna Sangham Award for the best RPS to Chirakadavu RPS. Thiruvanchoor Radhakrishnan presented the citation and handed over the cash award to K E Chacko, president of RPS.
Rubber Board Member Joseph Vazhackan MLA presented the farmer innovation award to Abraham Anchani for having developed the tapping shade.
P C Cyriac IAS (Rtd.), former Chairman, Rubber Board introduced the concept of RPS to the meeting. P Mukundan Menon, former Rubber Production Commissioner introduced the best RPS selected for the award, to the gathering.
The Chief Minister honoured P C Cyriac, P Mukundan Menon and Dr A K Krishnakumar while Sreedevi received the award on behalf of her late husband P K Narayanan (former Rubber Production Commissioner) for their valuable services in pushing forward the concept of the RPS in their formative years.
India: Domestic rubber prices surge above Rs 200/Kg
December 13, 2011
KOCHI: Rubber prices have rebounded to above Rs 200 per kg in the local market as tyre manufacturers step up procurement spurred by higher automobile sales.
Growers are willing to release the stock into the market as the current level of price is around Rs 20-25 higher than the international market, which has been hit by the debt crisis in Europe.
Improved sales in the passenger car segment have led tyremakers to make more purchases. Since the local rubber prices were hovering below the Rs 200/kg mark, the growers were reluctant to go on a selling mode. But on December 5, the price of RSS-4 variety, used by the tyremakers, moved up to Rs 201 per kg and it went up to Rs 204 before falling by Rs 3 on selling pressure a few days later.
The tyremakers are exploring both options: they are importing as well as making local purchases. “Even with rupee at Rs 52 a dollar, the imports are more viable at the current level of global prices. We will complete the import quota allowed by the government at reduced duty by the end of December,” said Swaranjit Singh, materials director at JK Tyres, adding that the tyre company is also making use of the peak production season in the domestic market.
The rubber production has grown by 4.9% to 5,75,100 tonne in the April-November period. For the given period, the consumption rose by just 0.7% to 6,32,615 tonne. Unlike the passenger car segment, the demand in OEM and truck tyre sectors has remained subdued. The rubber imports are rising though overall imports for the eight-month period are still down by 26%.
The delay in the landing of imported rubber could have forced tyremakers to buy more from the local market. “They were expecting it in early December but looks like towards the end of the month. The growers are willing to sell above Rs 200 as the international prices are over Rs 20 lower,” said George Valy, president of theRubber Dealers Association.
December 13, 2011
SINGAPORE, Dec 13 (Reuters) – Tokyo rubber futures extended losses on Tuesday as equities and other commodities fell after a European Union summit aimed at solving the region’s deteriorating debt crisis failed to restore financial market confidence. Stocks in Asia plunged and the euro languished near a two-month low as investors took fright at the prospect of mass euro zone sovereign ratings downgrades after the outcome of a “last chance” EU summit was unable to convince markets. The most active Tokyo Commodity Exchange rubber contract for May delivery ended 2.8 yen a kg lower at 274.6 yen after hitting an intraday low at 272.2 yen. The contract plunged to a near 2-year low of around 248 yen in November.
“For this week, I think the concern is more on the European debt crisis. Rubber is more likely to track macroeconomics changes,” said Ker Chung Yang, analyst at Phillip Futures in Singapore. “Coming to the year-end, I would expect the physical market to go quieter,” said Ker, who pegged support levels at 248 and 250 yen.
In the physical market, Indonesia’s SIR20 tyre grade changed hands at 154.50 U.S. cents a pound ($3.41 a kg) for February shipment. Offers were limited in Southeast Asia after a combination of dry and wet weather curbed supply in Thailand, Indonesia and Malaysia. The Indonesia Commodity & Derivative Exchange (ICDX) is planning to launch a physical rubber contract following talks with the International Tripartite Rubber Council, but timescale and details had yet to be decided. In other commodities, gold fell to its lowest in seven weeks, London copper extended losses, while Brent crude was little changed after falling in the previous session on worries that last week’s pact by European leaders may not be enough to limit the region’s debt crisis.
Major rubber growers may back physical market in benchmark drive
December 12, 2011
AKARTA: Thailand, Indonesia and Malaysia, which account for about 70% of natural-rubber output, plan to set up a regional physical market to create a new benchmark for the commodity, according to a trade group.
The market would help producers trade with more transparent and reliable prices, Tjahjono Budiarto Tjandra, chairman of the Committee on Strategic Market Operations at the International Rubber Consortium, said in an interview in Bali on Monday.
The countries agreed to take “specific measures” to support prices, Bayu Krisnamurthi, Indonesia’s deputy trade minister, told reporters in Bali after a meeting of representatives from the three governments. Rubber has slumped in Tokyo this year as Europe’s debt crisis raised concern that demand may drop.
The Tokyo Commodity Exchange, which trades that benchmark, is tracking the contract plan. The initiative may involve the Indonesia Commodity & Derivatives Exchange, the Agricultural Futures Exchange of Thailand and the Malaysia Derivatives Exchange, Tjandra said.
“We’re ready to start the rubber contract next year,” Megain Widjaja, chief executive officer of the Indonesia Commodity & Derivatives Exchange, or ICDX, said in an interview. The three Southeast Asian exchanges and the consortium met in Phuket, Thailand last month to discuss the plan, Widjaja said.
“Although the current rubber price has declined from early 2011, it is still quite high,” Bayu said. “We must be ready for any situation that may further pressure the price.” Rubber futures in Tokyo are set for their worst annual performance since 2008, when the global economic recession reduced demand.
The contract for delivery in May closed at 277.4 yen per kg on Tocom on Monday. “We will closely watch the development of the issue,” said Fuminori Kondo, a spokesman for Tocom.
“We’ve heard similar ideas before. As the three producing countries represent 70% of global rubber output, the idea is interesting to us as our bourse trades rubber futures.”The Agricultural Futures Exchange of Thailand welcomed the rubber plan, which merits further study, according to Chairman Prasat Kesawapitak.
“The initiative also needs support from the government to help stabilize the price.” The International Tripartite Rubber Council - which represents growers and exporters from Thailand, Indonesia and Malaysia – last month encouraged members to blacklist buyers who default on purchases. Members may curb exports if necessary to limit supply and boost prices, the group said on November 19.
“There’s a desire from the governments of the three countries to set up a market as soon as possible that would be based on the real supply-and-demand fundamentals,” said Tjandra from the consortium, which represents growers and exporters from Thailand, Indonesia and Malaysia. The contract would most likely trade in dollars, he said.
Market on Dec 12: Spot rubber rules steady
December 12, 2011
KOTTAYAM, DEC. 12:
Spot rubber continued to rule unchanged on Monday. Sentiments were almost neutral following a weak closing in domestic futures on the National Multi Commodity Exchange (NMCE).
According to sources, the market remained under pressure on comparatively higher imports and slightly increased supplies above the Rs 200-mark. Imports showed a rise of almost five per cent in November, while exports went up to 580 tonnes compared with 60 tonnes during the same period last year, they added.
Sheet rubber finished steady at Rs 202 a kg, according to traders. It was flat at Rs 201.50 a kg both at Kottayam and Kochi, as reported by the Rubber Board.
In futures, the December series slipped to Rs 201.20 (202.98), January to Rs 202.50 (205.01), February to Rs 204.50 (207.19), March to Rs 207.65 (209.75), April to Rs 211.51 (214.63) and May to Rs 213.51 (216.50) a kg for RSS 4 on the NMCE.
The December futures increased to ¥263.4 (Rs 178.28) from ¥260.3 a kg during the day session but then dropped to ¥260 (Rs 176.01) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 202 (202); RSS-5: 199 (199); ungraded: 193 (193); ISNR 20: 189 (189) and latex 60 per cent: 111 (110).
India: Natural rubber demand-supply gap narrows
December 13, 2011
The gap between production and consumption of natural rubber (NR) narrowed in November. Though consumption grew at a much lower pace than production, the gap at November-end fell to 57,515 tonnes from 70,725 tonnes in April-October.
During April-November, consumption increased 0.7 per cent due to the economic slowdown and the euro zone crisis, while production increased 4.9 per cent. Still, there was a marginal increase of 0.2 per cent in the cumulative consumption in April-October.
Average consumption during April-November increased to 632,615 tonnes, as against 628,240 tonnes in the same period of the last financial year. According to provisional figures of the Rubber Board, total production increased 4.9 per cent to 575,100 tonnes as against 548,150 tonnes.
Production of NR in November increased 4.3 per cent to 94,400 tonnes compared to 90,500 tonnes during November 2010. Monthly consumption increased seven per cent to 82,000 tonnes compared to 78,010 tonnes.
Tyre sector hit
Most tyre companies in India are facing severe problems on the demand side, due to low automobile sales. This caused a drastic reduction in the demand from the original equipment (OE) segment for the last few months. Industry sources said the improvement is not an indication of better status of rubber-based industries.
Leading rubber dealer and former president of the Cochin Rubber Merchants Association, N Radhakrish-nan said tyre production had picked up pace marginally, but the non-tyre sector was still under pressure. The slight increase in consumption is because of the improvement in tyre production.
Tyre companies are buying rubber as prices are comparatively low now. But, the crisis of small and medium non-tyre units is continuing and a large number are on the verge of closure, he said. According to information from the All-India Rubber Industries Association, 500 such units have shut shop.
According to Rajiv Budh-raja, director general, Autom-otive Tyre Manufacturers’ Association, the slowdown in the tyre sector continues. Tyre production increased seven per cent in April-October as against a double-digit increase in the same period last year. The production of truck/bus tyres was flat, while car tyre output increased three per cent. Radhakrishnan said prices would move on a steady note as rich farmers are holding stock for better price realisation. Also, global supply is low due to poor production in Thailand, the world’s largest NR producer, due to rain and floods. Supply is expected to fall 5.6 per cent in 2011.
Import, exports
Though the local market is not having enough rubber and the prices abroad are lower than in India, imports have declined in the current year. Total imports during April-November were 111,899 tonnes as against 152,658 tonnes in the same period of last year.
Meanwhile, exports were up 430 per cent to 20,784 tonnes as against 4,798 tonnes in the same period last year.
India rubber seen steady on supply, rupee
December 13, 2011
Dec 13 (Reuters) – Natural rubber prices in India are likely to tread water this week due to steady supplies and as a depreciating Indian rupee is nullifying the benefit of buying from overseas markets, analysts said.
At 3:35 p.m on Tuesday, the benchmark January rubber on India’s National Multi-Commodity Exchange (NMCE) was 0.1 percent down at 20,249 rupees per 100 kg.
The price of the most traded RSS-4 rubber (ribbed, smoked sheet) in the key Kochi market in Kerala fell 103 rupees to 20,067 rupees per 100 kg.
Spot price in Bangkok, Thailand, was 18,025 rupees on Tuesday.
“Taping is going on in full swing, but it is not materialising in rubber supplies in the same proportion. Supplies are steady,” said Jose Mambarambil, vice-president at Indian Rubber Dealers’ Federation (IRDF).
“Farmers are storing latex in drums after tapping. Due to labour shortage, they are finding it difficult to make rubber sheets. Besides, many farmers are holding supplies hoping prices will rise after January,” he said.
Rubber production in India peaks during Oct-Jan.
Tyre makers were aggressively signing import deals but pace may falter in coming weeks due to a weak rupee, Mambarambil said.
India’s natural rubber imports edged up 4.6 percent in November to 15,069 tonnes, the state-run Rubber Board said on Dec. 9, and steep price fall in overseas markets is likely to continue to make imports attractive for tyre makers.
The country’s production during the month rose 4.3 percent on a year ago to 94,400 tonnes, while consumption was 82,000 tonnes compared with 78,010 tonnes a year ago, it said.
India, the world’s fourth biggest producer, imports natural rubber from Thailand, Indonesia, Malaysia and Vietnam.
Tokyo rubber futures extended losses on Tuesday as equities and other commodities fell after a European Union summit aimed at solving the region’s deteriorating debt crisis failed to restore financial market confidence.
The Indian rupee slumped to an all-time low of 53.52 to the dollar on Tuesday.
India’s tyre output growth is likely to almost halve in the fiscal year ending March 2012 to 12 percent, as vehicle sales slowed because of higher interest rates, hitting demand from automakers, a senior industry official said on Sept. 9.
The country’s production for the current financial year is estimated at 902,000 tonnes and consumption at 977,000 tonnes. (Reporting by Rajendra Jadhav; Editing by Rajesh Pandathil)
India: CM pushing for a hike in subsidy for rubber growers
December 14, 2011
KOTTAYAM: Support for Rubber Producers Societies (RPS) from local self-government bodies and panchayats was under the consideration of the state government, chief minister Oommen Chandy said here on Tuesday. He was inaugurating the year-long silver jubilee celebrations of RPS at the Mammen Mappilai Hall. here.
“The government is seriously considering giving support to RPS from a share of project funds,” he said. He also said that the Planning Board had taken a decision regarding that in 2005 but an approval did not come from the government then. “Now the matter is back with the Planning Board,” he said. Higher Subsidy
Chandy said that his government had brought the issues faced by rubber planters to the attention of the central government. “The most important recommendation is about the subsidy given for replanting of rubber. This amount was fixed years ago and is still the same. Considering the expenses connected with farming these days, that amount is meagre. The Rubber Board has recommended increase of the subsidy to Rs 50,000. The state government has requested the Centre to consider this demand of the board as one from the state itself,” said Chandy.
He said that the agricultural sector was the strength of the state and rubber occupied a prominent place in it. He lauded the Rubber Board for playing an active role in achieving that place. Revenue minister Thiruvanchoor Radhakrishnan presided over the function. Sheela Thomas IAS, chairman, Rubber Board, welcomed the gathering.
The chief minister presented the Suvarna Sangham Award for the best RPS to Chirakadavu RPS. Thiruvanchoor Radhakrishnan presented the citation and handed over the cash award to K E Chacko, president of RPS.
Rubber Board Member Joseph Vazhackan MLA presented the farmer innovation award to Abraham Anchani for having developed the tapping shade.
P C Cyriac IAS (Rtd.), former Chairman, Rubber Board introduced the concept of RPS to the meeting. P Mukundan Menon, former Rubber Production Commissioner introduced the best RPS selected for the award, to the gathering.
The Chief Minister honoured P C Cyriac, P Mukundan Menon and Dr A K Krishnakumar while Sreedevi received the award on behalf of her late husband P K Narayanan (former Rubber Production Commissioner) for their valuable services in pushing forward the concept of the RPS in their formative years.
India: Domestic rubber prices surge above Rs 200/Kg
December 13, 2011
KOCHI: Rubber prices have rebounded to above Rs 200 per kg in the local market as tyre manufacturers step up procurement spurred by higher automobile sales.
Growers are willing to release the stock into the market as the current level of price is around Rs 20-25 higher than the international market, which has been hit by the debt crisis in Europe.
Improved sales in the passenger car segment have led tyremakers to make more purchases. Since the local rubber prices were hovering below the Rs 200/kg mark, the growers were reluctant to go on a selling mode. But on December 5, the price of RSS-4 variety, used by the tyremakers, moved up to Rs 201 per kg and it went up to Rs 204 before falling by Rs 3 on selling pressure a few days later.
The tyremakers are exploring both options: they are importing as well as making local purchases. “Even with rupee at Rs 52 a dollar, the imports are more viable at the current level of global prices. We will complete the import quota allowed by the government at reduced duty by the end of December,” said Swaranjit Singh, materials director at JK Tyres, adding that the tyre company is also making use of the peak production season in the domestic market.
The rubber production has grown by 4.9% to 5,75,100 tonne in the April-November period. For the given period, the consumption rose by just 0.7% to 6,32,615 tonne. Unlike the passenger car segment, the demand in OEM and truck tyre sectors has remained subdued. The rubber imports are rising though overall imports for the eight-month period are still down by 26%.
The delay in the landing of imported rubber could have forced tyremakers to buy more from the local market. “They were expecting it in early December but looks like towards the end of the month. The growers are willing to sell above Rs 200 as the international prices are over Rs 20 lower,” said George Valy, president of theRubber Dealers Association.
Tokyo futures end 1 pct lower, euro debt worries linger
Tokyo futures end 1 pct lower, euro debt worries linger
December 13, 2011
SINGAPORE, Dec 13 (Reuters) – Tokyo rubber futures extended losses on Tuesday as equities and other commodities fell after a European Union summit aimed at solving the region’s deteriorating debt crisis failed to restore financial market confidence. Stocks in Asia plunged and the euro languished near a two-month low as investors took fright at the prospect of mass euro zone sovereign ratings downgrades after the outcome of a “last chance” EU summit was unable to convince markets. The most active Tokyo Commodity Exchange rubber contract for May delivery ended 2.8 yen a kg lower at 274.6 yen after hitting an intraday low at 272.2 yen. The contract plunged to a near 2-year low of around 248 yen in November.
“For this week, I think the concern is more on the European debt crisis. Rubber is more likely to track macroeconomics changes,” said Ker Chung Yang, analyst at Phillip Futures in Singapore. “Coming to the year-end, I would expect the physical market to go quieter,” said Ker, who pegged support levels at 248 and 250 yen.
In the physical market, Indonesia’s SIR20 tyre grade changed hands at 154.50 U.S. cents a pound ($3.41 a kg) for February shipment. Offers were limited in Southeast Asia after a combination of dry and wet weather curbed supply in Thailand, Indonesia and Malaysia. The Indonesia Commodity & Derivative Exchange (ICDX) is planning to launch a physical rubber contract following talks with the International Tripartite Rubber Council, but timescale and details had yet to be decided. In other commodities, gold fell to its lowest in seven weeks, London copper extended losses, while Brent crude was little changed after falling in the previous session on worries that last week’s pact by European leaders may not be enough to limit the region’s debt crisis.
Major rubber growers may back physical market in benchmark drive
December 12, 2011
AKARTA: Thailand, Indonesia and Malaysia, which account for about 70% of natural-rubber output, plan to set up a regional physical market to create a new benchmark for the commodity, according to a trade group.
The market would help producers trade with more transparent and reliable prices, Tjahjono Budiarto Tjandra, chairman of the Committee on Strategic Market Operations at the International Rubber Consortium, said in an interview in Bali on Monday.
The countries agreed to take “specific measures” to support prices, Bayu Krisnamurthi, Indonesia’s deputy trade minister, told reporters in Bali after a meeting of representatives from the three governments. Rubber has slumped in Tokyo this year as Europe’s debt crisis raised concern that demand may drop.
The Tokyo Commodity Exchange, which trades that benchmark, is tracking the contract plan. The initiative may involve the Indonesia Commodity & Derivatives Exchange, the Agricultural Futures Exchange of Thailand and the Malaysia Derivatives Exchange, Tjandra said.
“We’re ready to start the rubber contract next year,” Megain Widjaja, chief executive officer of the Indonesia Commodity & Derivatives Exchange, or ICDX, said in an interview. The three Southeast Asian exchanges and the consortium met in Phuket, Thailand last month to discuss the plan, Widjaja said.
“Although the current rubber price has declined from early 2011, it is still quite high,” Bayu said. “We must be ready for any situation that may further pressure the price.” Rubber futures in Tokyo are set for their worst annual performance since 2008, when the global economic recession reduced demand.
The contract for delivery in May closed at 277.4 yen per kg on Tocom on Monday. “We will closely watch the development of the issue,” said Fuminori Kondo, a spokesman for Tocom.
“We’ve heard similar ideas before. As the three producing countries represent 70% of global rubber output, the idea is interesting to us as our bourse trades rubber futures.”The Agricultural Futures Exchange of Thailand welcomed the rubber plan, which merits further study, according to Chairman Prasat Kesawapitak.
“The initiative also needs support from the government to help stabilize the price.” The International Tripartite Rubber Council - which represents growers and exporters from Thailand, Indonesia and Malaysia – last month encouraged members to blacklist buyers who default on purchases. Members may curb exports if necessary to limit supply and boost prices, the group said on November 19.
“There’s a desire from the governments of the three countries to set up a market as soon as possible that would be based on the real supply-and-demand fundamentals,” said Tjandra from the consortium, which represents growers and exporters from Thailand, Indonesia and Malaysia. The contract would most likely trade in dollars, he said.
Market on Dec 12: Spot rubber rules steady
December 12, 2011
KOTTAYAM, DEC. 12:
Spot rubber continued to rule unchanged on Monday. Sentiments were almost neutral following a weak closing in domestic futures on the National Multi Commodity Exchange (NMCE).
According to sources, the market remained under pressure on comparatively higher imports and slightly increased supplies above the Rs 200-mark. Imports showed a rise of almost five per cent in November, while exports went up to 580 tonnes compared with 60 tonnes during the same period last year, they added.
Sheet rubber finished steady at Rs 202 a kg, according to traders. It was flat at Rs 201.50 a kg both at Kottayam and Kochi, as reported by the Rubber Board.
In futures, the December series slipped to Rs 201.20 (202.98), January to Rs 202.50 (205.01), February to Rs 204.50 (207.19), March to Rs 207.65 (209.75), April to Rs 211.51 (214.63) and May to Rs 213.51 (216.50) a kg for RSS 4 on the NMCE.
The December futures increased to ¥263.4 (Rs 178.28) from ¥260.3 a kg during the day session but then dropped to ¥260 (Rs 176.01) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 202 (202); RSS-5: 199 (199); ungraded: 193 (193); ISNR 20: 189 (189) and latex 60 per cent: 111 (110).
December 13, 2011
SINGAPORE, Dec 13 (Reuters) – Tokyo rubber futures extended losses on Tuesday as equities and other commodities fell after a European Union summit aimed at solving the region’s deteriorating debt crisis failed to restore financial market confidence. Stocks in Asia plunged and the euro languished near a two-month low as investors took fright at the prospect of mass euro zone sovereign ratings downgrades after the outcome of a “last chance” EU summit was unable to convince markets. The most active Tokyo Commodity Exchange rubber contract for May delivery ended 2.8 yen a kg lower at 274.6 yen after hitting an intraday low at 272.2 yen. The contract plunged to a near 2-year low of around 248 yen in November.
“For this week, I think the concern is more on the European debt crisis. Rubber is more likely to track macroeconomics changes,” said Ker Chung Yang, analyst at Phillip Futures in Singapore. “Coming to the year-end, I would expect the physical market to go quieter,” said Ker, who pegged support levels at 248 and 250 yen.
In the physical market, Indonesia’s SIR20 tyre grade changed hands at 154.50 U.S. cents a pound ($3.41 a kg) for February shipment. Offers were limited in Southeast Asia after a combination of dry and wet weather curbed supply in Thailand, Indonesia and Malaysia. The Indonesia Commodity & Derivative Exchange (ICDX) is planning to launch a physical rubber contract following talks with the International Tripartite Rubber Council, but timescale and details had yet to be decided. In other commodities, gold fell to its lowest in seven weeks, London copper extended losses, while Brent crude was little changed after falling in the previous session on worries that last week’s pact by European leaders may not be enough to limit the region’s debt crisis.
Major rubber growers may back physical market in benchmark drive
December 12, 2011
AKARTA: Thailand, Indonesia and Malaysia, which account for about 70% of natural-rubber output, plan to set up a regional physical market to create a new benchmark for the commodity, according to a trade group.
The market would help producers trade with more transparent and reliable prices, Tjahjono Budiarto Tjandra, chairman of the Committee on Strategic Market Operations at the International Rubber Consortium, said in an interview in Bali on Monday.
The countries agreed to take “specific measures” to support prices, Bayu Krisnamurthi, Indonesia’s deputy trade minister, told reporters in Bali after a meeting of representatives from the three governments. Rubber has slumped in Tokyo this year as Europe’s debt crisis raised concern that demand may drop.
The Tokyo Commodity Exchange, which trades that benchmark, is tracking the contract plan. The initiative may involve the Indonesia Commodity & Derivatives Exchange, the Agricultural Futures Exchange of Thailand and the Malaysia Derivatives Exchange, Tjandra said.
“We’re ready to start the rubber contract next year,” Megain Widjaja, chief executive officer of the Indonesia Commodity & Derivatives Exchange, or ICDX, said in an interview. The three Southeast Asian exchanges and the consortium met in Phuket, Thailand last month to discuss the plan, Widjaja said.
“Although the current rubber price has declined from early 2011, it is still quite high,” Bayu said. “We must be ready for any situation that may further pressure the price.” Rubber futures in Tokyo are set for their worst annual performance since 2008, when the global economic recession reduced demand.
The contract for delivery in May closed at 277.4 yen per kg on Tocom on Monday. “We will closely watch the development of the issue,” said Fuminori Kondo, a spokesman for Tocom.
“We’ve heard similar ideas before. As the three producing countries represent 70% of global rubber output, the idea is interesting to us as our bourse trades rubber futures.”The Agricultural Futures Exchange of Thailand welcomed the rubber plan, which merits further study, according to Chairman Prasat Kesawapitak.
“The initiative also needs support from the government to help stabilize the price.” The International Tripartite Rubber Council - which represents growers and exporters from Thailand, Indonesia and Malaysia – last month encouraged members to blacklist buyers who default on purchases. Members may curb exports if necessary to limit supply and boost prices, the group said on November 19.
“There’s a desire from the governments of the three countries to set up a market as soon as possible that would be based on the real supply-and-demand fundamentals,” said Tjandra from the consortium, which represents growers and exporters from Thailand, Indonesia and Malaysia. The contract would most likely trade in dollars, he said.
Market on Dec 12: Spot rubber rules steady
December 12, 2011
KOTTAYAM, DEC. 12:
Spot rubber continued to rule unchanged on Monday. Sentiments were almost neutral following a weak closing in domestic futures on the National Multi Commodity Exchange (NMCE).
According to sources, the market remained under pressure on comparatively higher imports and slightly increased supplies above the Rs 200-mark. Imports showed a rise of almost five per cent in November, while exports went up to 580 tonnes compared with 60 tonnes during the same period last year, they added.
Sheet rubber finished steady at Rs 202 a kg, according to traders. It was flat at Rs 201.50 a kg both at Kottayam and Kochi, as reported by the Rubber Board.
In futures, the December series slipped to Rs 201.20 (202.98), January to Rs 202.50 (205.01), February to Rs 204.50 (207.19), March to Rs 207.65 (209.75), April to Rs 211.51 (214.63) and May to Rs 213.51 (216.50) a kg for RSS 4 on the NMCE.
The December futures increased to ¥263.4 (Rs 178.28) from ¥260.3 a kg during the day session but then dropped to ¥260 (Rs 176.01) in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 202 (202); RSS-5: 199 (199); ungraded: 193 (193); ISNR 20: 189 (189) and latex 60 per cent: 111 (110).
Monday, December 12, 2011
Rubber production in Nov rises 4.3% on favourable weather
Rubber production in Nov rises 4.3% on favourable weather
December 10, 2011
KOCHI, DEC. 9:
Due to extremely favourable weather conditions and increased tapping intensity by the farmer, rubber production in the country has grown by 4.3 per cent to 94,400 tonnes (90,500 tonnes) in November 2011. Sources in the Rubber Board said that the average rainfall for November in the environs of Kottayam was 11 cm while the ideal precipitation for rubber estimated around 10 cm. Last year the rainfall was recorded at 20.6 cm, substantially higher than the ideal conditions.
IMPROVED YIELD
With prices climbing above the Rs 200 a kg mark, rubber farmers have increased their tapping intensity and yields have also improved. After the lull of October, demand for automobiles has begun to look up and rubber consumption has also improved, sources said. Rubber consumption increased by 5.1 per cent to 82,000 tonnes (78,010 tonnes). Going by the early indications, both production and consumption are expected to be higher this month as well.
PEAK SEASON
The coming months of December-January also happen to be the peak rubber production season in India with virtually no rainfall, cold nights and bright, sunny days. The soil humidity which was built up over the North East monsoon period is expected to aid rubber production.
Although rubber import was up just a tad for November, the overall imports for April-November period remained significantly lower. Exports have remained substantially higher than last year, both for November as well as for first eight months of the current fiscal. Production continued to be higher during April-November 2011 as against the corresponding period of last year, while consumption was significantly lower, reflecting the production numbers of the automobile industry.
According to the revised estimates, the stock of natural rubber at the end of November was down at 2,55,000 tonnes as against 2,80,728 tonnes of last year. However there is absolute shortage of rubber in the domestic market, Mr N Radhakrishnan, Advisor to Cochin Rubber Merchants Association said. Although Indian rubber prices are ruling higher than international prices, the farmers are holding on to their stocks.
Despite the marked disparity between the domestic and international prices, industry has not resorted to wholesale imports because of the huge erosion in the value of the Indian rupee against major currencies. This has made imports tricky. However Mr Radhakrishnan warned that the situation may not prevail for long and that the industries might resort to huge imports, which will be detrimental to farmers. Since imports would require a lead time of around one month, he said that rubber imports might soon commence in earnest unless the situation on the ground improve fast.
Next week: Uncertain outlook for rubber market
Written by HMH | December 10, 2011 | 1 |
Dealers are unsure which way the Malaysian rubber market will head next week.
Supply was tight as the rainy season in major producing countries would dampen output, one of them said.
The euro debt crisis, however, would continue loom over the market and keep traders on the sidelines, he added.
“If leaders of the European countries are able to come up with a solid approach for the region’s debt crisis, the market is likely to be steady,” the dealer said.
This week, the Malaysian Rubber Board’s official physical price for tyre-grade SMR 20 gained 36.0 sen to 1,070.0 sen per kg from 1,034.0 sen a week earlier while latex in bulk gained 8.0 sen to 697.0 sen per kg from 689.0 sen.
The unofficial closing price for SMR 20 went up 17.0 sen to 1,047.5 sen per kg from 1,030.5 sen previously while latex in bulk increased 5.5 sen to 692.5 sen from 687.0 sen. — Bernama
December 10, 2011
KOCHI, DEC. 9:
Due to extremely favourable weather conditions and increased tapping intensity by the farmer, rubber production in the country has grown by 4.3 per cent to 94,400 tonnes (90,500 tonnes) in November 2011. Sources in the Rubber Board said that the average rainfall for November in the environs of Kottayam was 11 cm while the ideal precipitation for rubber estimated around 10 cm. Last year the rainfall was recorded at 20.6 cm, substantially higher than the ideal conditions.
IMPROVED YIELD
With prices climbing above the Rs 200 a kg mark, rubber farmers have increased their tapping intensity and yields have also improved. After the lull of October, demand for automobiles has begun to look up and rubber consumption has also improved, sources said. Rubber consumption increased by 5.1 per cent to 82,000 tonnes (78,010 tonnes). Going by the early indications, both production and consumption are expected to be higher this month as well.
PEAK SEASON
The coming months of December-January also happen to be the peak rubber production season in India with virtually no rainfall, cold nights and bright, sunny days. The soil humidity which was built up over the North East monsoon period is expected to aid rubber production.
Although rubber import was up just a tad for November, the overall imports for April-November period remained significantly lower. Exports have remained substantially higher than last year, both for November as well as for first eight months of the current fiscal. Production continued to be higher during April-November 2011 as against the corresponding period of last year, while consumption was significantly lower, reflecting the production numbers of the automobile industry.
According to the revised estimates, the stock of natural rubber at the end of November was down at 2,55,000 tonnes as against 2,80,728 tonnes of last year. However there is absolute shortage of rubber in the domestic market, Mr N Radhakrishnan, Advisor to Cochin Rubber Merchants Association said. Although Indian rubber prices are ruling higher than international prices, the farmers are holding on to their stocks.
Despite the marked disparity between the domestic and international prices, industry has not resorted to wholesale imports because of the huge erosion in the value of the Indian rupee against major currencies. This has made imports tricky. However Mr Radhakrishnan warned that the situation may not prevail for long and that the industries might resort to huge imports, which will be detrimental to farmers. Since imports would require a lead time of around one month, he said that rubber imports might soon commence in earnest unless the situation on the ground improve fast.
Next week: Uncertain outlook for rubber market
Written by HMH | December 10, 2011 | 1 |
Dealers are unsure which way the Malaysian rubber market will head next week.
Supply was tight as the rainy season in major producing countries would dampen output, one of them said.
The euro debt crisis, however, would continue loom over the market and keep traders on the sidelines, he added.
“If leaders of the European countries are able to come up with a solid approach for the region’s debt crisis, the market is likely to be steady,” the dealer said.
This week, the Malaysian Rubber Board’s official physical price for tyre-grade SMR 20 gained 36.0 sen to 1,070.0 sen per kg from 1,034.0 sen a week earlier while latex in bulk gained 8.0 sen to 697.0 sen per kg from 689.0 sen.
The unofficial closing price for SMR 20 went up 17.0 sen to 1,047.5 sen per kg from 1,030.5 sen previously while latex in bulk increased 5.5 sen to 692.5 sen from 687.0 sen. — Bernama
Saturday, December 10, 2011
Indian tyre industry facing threat from cheap Chinese imports
Indian tyre industry facing threat from cheap Chinese imports
December 9, 2011
The Chairman of Rubber Board, Sheila Thomas, said that India’s rubber industry is facing a threat due to cheap import of products from China, adding that the country could easily overcome this problem since the quality of products manufactured in India are superior as compared to other countries.
She said this on the sidelines of a prize giving ceremony for rubber growers in Agartala.
“China is mostly cheaper goods, how they produce it we don’t know, especially non-tyre, but tyre also. Tyre people are also facing threat from cheaper imports from China. But, then we can, through our competence and government has some measures to help them out, so I am sure they can. Quality-wise we are superior to everyone in the world I think, that’s why all the tyre majors are coming to India now to put up their plants,” said Thomas.
Thomas added that rubber has helped the farmers to get a steady income, and they are able to get good money for their produce almost throughout the year.
“Rubber has certainly helped in giving the people a sustainable income, the best part about rubber is that it can yield almost throughout the year, only except for a brief gap in summer and here in winter. So, that gives a steady income to the farmer and prices now are good. If the economic growth improves, then consumption of rubber will also go up,” she added.
She predicted that in the near future Indian economy would emerge stronger as the demand for natural rubber is directly proportional to the GDP of a nation. (ANI)
Rubber production in Nov rises 4.3% on favourable weather
Written by HMH | December 10, 2011 | 0 |
KOCHI, DEC. 9:
Due to extremely favourable weather conditions and increased tapping intensity by the farmer, rubber production in the country has grown by 4.3 per cent to 94,400 tonnes (90,500 tonnes) in November 2011. Sources in the Rubber Board said that the average rainfall for November in the environs of Kottayam was 11 cm while the ideal precipitation for rubber estimated around 10 cm. Last year the rainfall was recorded at 20.6 cm, substantially higher than the ideal conditions.
IMPROVED YIELD
With prices climbing above the Rs 200 a kg mark, rubber farmers have increased their tapping intensity and yields have also improved. After the lull of October, demand for automobiles has begun to look up and rubber consumption has also improved, sources said. Rubber consumption increased by 5.1 per cent to 82,000 tonnes (78,010 tonnes). Going by the early indications, both production and consumption are expected to be higher this month as well.
PEAK SEASON
The coming months of December-January also happen to be the peak rubber production season in India with virtually no rainfall, cold nights and bright, sunny days. The soil humidity which was built up over the North East monsoon period is expected to aid rubber production.
Although rubber import was up just a tad for November, the overall imports for April-November period remained significantly lower. Exports have remained substantially higher than last year, both for November as well as for first eight months of the current fiscal. Production continued to be higher during April-November 2011 as against the corresponding period of last year, while consumption was significantly lower, reflecting the production numbers of the automobile industry.
According to the revised estimates, the stock of natural rubber at the end of November was down at 2,55,000 tonnes as against 2,80,728 tonnes of last year. However there is absolute shortage of rubber in the domestic market, Mr N Radhakrishnan, Advisor to Cochin Rubber Merchants Association said. Although Indian rubber prices are ruling higher than international prices, the farmers are holding on to their stocks.
Despite the marked disparity between the domestic and international prices, industry has not resorted to wholesale imports because of the huge erosion in the value of the Indian rupee against major currencies. This has made imports tricky. However Mr Radhakrishnan warned that the situation may not prevail for long and that the industries might resort to huge imports, which will be detrimental to farmers. Since imports would require a lead time of around one month, he said that rubber imports might soon commence in earnest unless the situation on the ground improve fast.
December 9, 2011
The Chairman of Rubber Board, Sheila Thomas, said that India’s rubber industry is facing a threat due to cheap import of products from China, adding that the country could easily overcome this problem since the quality of products manufactured in India are superior as compared to other countries.
She said this on the sidelines of a prize giving ceremony for rubber growers in Agartala.
“China is mostly cheaper goods, how they produce it we don’t know, especially non-tyre, but tyre also. Tyre people are also facing threat from cheaper imports from China. But, then we can, through our competence and government has some measures to help them out, so I am sure they can. Quality-wise we are superior to everyone in the world I think, that’s why all the tyre majors are coming to India now to put up their plants,” said Thomas.
Thomas added that rubber has helped the farmers to get a steady income, and they are able to get good money for their produce almost throughout the year.
“Rubber has certainly helped in giving the people a sustainable income, the best part about rubber is that it can yield almost throughout the year, only except for a brief gap in summer and here in winter. So, that gives a steady income to the farmer and prices now are good. If the economic growth improves, then consumption of rubber will also go up,” she added.
She predicted that in the near future Indian economy would emerge stronger as the demand for natural rubber is directly proportional to the GDP of a nation. (ANI)
Rubber production in Nov rises 4.3% on favourable weather
Written by HMH | December 10, 2011 | 0 |
KOCHI, DEC. 9:
Due to extremely favourable weather conditions and increased tapping intensity by the farmer, rubber production in the country has grown by 4.3 per cent to 94,400 tonnes (90,500 tonnes) in November 2011. Sources in the Rubber Board said that the average rainfall for November in the environs of Kottayam was 11 cm while the ideal precipitation for rubber estimated around 10 cm. Last year the rainfall was recorded at 20.6 cm, substantially higher than the ideal conditions.
IMPROVED YIELD
With prices climbing above the Rs 200 a kg mark, rubber farmers have increased their tapping intensity and yields have also improved. After the lull of October, demand for automobiles has begun to look up and rubber consumption has also improved, sources said. Rubber consumption increased by 5.1 per cent to 82,000 tonnes (78,010 tonnes). Going by the early indications, both production and consumption are expected to be higher this month as well.
PEAK SEASON
The coming months of December-January also happen to be the peak rubber production season in India with virtually no rainfall, cold nights and bright, sunny days. The soil humidity which was built up over the North East monsoon period is expected to aid rubber production.
Although rubber import was up just a tad for November, the overall imports for April-November period remained significantly lower. Exports have remained substantially higher than last year, both for November as well as for first eight months of the current fiscal. Production continued to be higher during April-November 2011 as against the corresponding period of last year, while consumption was significantly lower, reflecting the production numbers of the automobile industry.
According to the revised estimates, the stock of natural rubber at the end of November was down at 2,55,000 tonnes as against 2,80,728 tonnes of last year. However there is absolute shortage of rubber in the domestic market, Mr N Radhakrishnan, Advisor to Cochin Rubber Merchants Association said. Although Indian rubber prices are ruling higher than international prices, the farmers are holding on to their stocks.
Despite the marked disparity between the domestic and international prices, industry has not resorted to wholesale imports because of the huge erosion in the value of the Indian rupee against major currencies. This has made imports tricky. However Mr Radhakrishnan warned that the situation may not prevail for long and that the industries might resort to huge imports, which will be detrimental to farmers. Since imports would require a lead time of around one month, he said that rubber imports might soon commence in earnest unless the situation on the ground improve fast.
Friday, December 9, 2011
Natural rubber supply to fall 5.6% this year
Natural rubber supply to fall 5.6% this year
December 7, 2011
The latest estimates of demand and supply of natural rubber (NR) by the Association of Natural Rubber Producing Countries (ANRPC) show the supply would be 5.6 per cent low in 2011 and 3.6 per cent in 2012.
The revised outlook suggests the total supply this year (January-December) will rise to 10.02 million tonnes (mt), up 5.6 per cent, but lower than the six per cent rate previously expected.
Early estimates by ANRPC indicate the price fall had started impacting the supply of the commodity. The global price of RSS-4 grade fell to Rs 174-175 a kg from Rs 185 a kg a month back. The average price in September was Rs 205 a kg. The decreasing trend in price is expected to affect the production of rubber. The total supply from member-countries of the ANRPC, which grew annually at 10.6 per cent in the first quarter and 10.7 per cent in the second, has slowed to 2.5 per cent in Q3, and is expected to do so further to 0.6 per cent in Q4.
ANRPC noted the supply of NR in the last quarter of 2010 was significantly down, and the forecast for the equivalent period in 2011 was only marginally above the reduced figure. The crisis in the euro zone has seriously affected output in most producing countries. ANRPC also estimates a three per cent fall in exports during October-December.
NR production increased five per cent during April-October. Total production increased to 480,700 tonnes as against 457,650 tonnes in the same period of last year. While consumption incre-ased to 551,425 tonnes as against 550,230 tonnes, the gap between production and consumption is likely to touch 150,000 tonnes.
Source: http://www.business-standard.com/india/news/natural-rubber-supply-to-fall-56-this-year/457872/
Tokyo futures drop, tracking oil, gold (Dec 9)
December 9, 2011
TOKYO, Dec 9 (Reuters) – Key Tokyo rubber futures fell 1.4 percent early on Friday, tracking losses in oil, gold and other commodities after comments from the head of the European Central Bank dashed hopes of more-dramatic action to fight the region’s debt crisis.
FUNDAMENTALS
* The key Tokyo Commodity Exchange rubber contract for May delivery <0#2JRU:> was changing hands at 286.9 yen per kg as of 0030 GMT, down 4.1 yen.
* On Thursday, the most active Shanghai rubber contract for May delivery fell 0.4 percent to close at 26,615 yuan per tonne. Volume stood at 808,000 lots.
* Crude oil futures fell for a second straight day on Thursday as disappointing comments from the head of the European Central Bank increased doubts among investors that the region’s debt crisis will be contained.
* The yen was steady against the dollar at 77.68.
* For the top stories in rubber market and other news, click, or
MARKET NEWS
* India’s carmakers may just break even in the fiscal year that ends in March, an industry body warned on Thursday and said it would cut its sales outlook for the year, as firms struggle with sluggish demand on rising input costs and high interest rates.
* Japan’s Nikkei average dropped on Friday after global shares slumped as steps from the European Central Bank disappointed some investors, and it flirted with key support at its 25-day moving average.
Most rubber defaulters new buyers from China – RTAS
December 7, 2011
SINGAPORE, Dec 7 (Reuters) – Inexperienced Chinese buyers have refused to take delivery of a bulk of the rubber shipped this year by major producers, but defaults are not as severe as in 2008, an official at the Rubber Trade Association of Singapore (RTAS) said on Wednesday.
The ASEAN Rubber Business Council, of which the RTAS is a member, has blacklisted buyers who defaulted on shipments and urged members to ignore requests for discounts following a plunge in prices.
“The defaulters this round are mainly new players to the rubber market who came in during the bull markets of 2009/2010 and who have not observed the sanctity of the contracts,” Benson Lim, a committee member of the RTAS, told Reuters by e-mail.
“The default situation this time round is not as bad as in 2008, and not 100 percent of the cases are related to Chinese buyers, who, however are the majority,” he added.
“Most of the older/established Chinese buyers are sticking to their contractual obligations despite the big price plunge.”
Buyers in China shocked the market late in 2008 when they refused to pay for their cargoes after prices tumbled by more than half due to the global financial crisis that hit automakers in Europe, North America and Japan hard.
Dealers’ estimates of these defaults varied from as little as 10,000 tonnes to as much as 200,000 tonnes, forcing officials from main producers Thailand, Indonesia and Malaysia to visit China to sort out the issue.
This year, cash rubber prices have halved since hitting a lifetime high at $6.40 a kg in February, on fears the debt crisis in Europe could hurt demand, and also because top consumer China told sellers they wanted to renegotiate prices.
The ARBC decided in a meeting in Hanoi at the weekend that it would act against defaulters, and asked members to stop dealing with them. It also said it had blacklisted defaulters and would eventually disclose their names to the public.
“The ARBC is still finalising the list as some members are still in the process of reporting some new cases,” said Lim.
The ARBC groups Thailand, Indonesia, Malaysia, Singapore, Vietnam and Cambodia. (Reporting by Lewa Pardomuan; editing by Miral Fahmy)
Tripura to face tough fight in rubber production
December 8, 2011
AGARTALA, Dec 8 – Tripura will face stiff competition in retaining second largest naturalrubber producing State tag if the production is not enhanced in the years to come, said Chief Minister Manik Sarkar.
Kerala, which has been contributing 82 per cent raw natural rubber in the country, has already been enjoying first position since a long time while Tripura’s position is secondwith only 8.2 per cent contribution.
Tripura will face tough challenge as many States have started showing interest in rubberplantation after suffering losses in the past, Sarakr said while speaking at a programmeorganized by the Rubber Board at Prajna Bhavan here.
Calling upon the experts of the Rubber Board to look into the problem that led to low productivity of natural rubber in the State, he said that the time has come to explore the full potential in the field of rubber cultivation.
Asserting that the rubber cultivation has been changing the face of rural economcy of the State, Sarkar said that there should be maximum efforts on the part of growers and experts on how to address the low production of natural rubber.
In her speech, Ms Sheela Thomas, the Chairman of the Rubber Board ruled out any adverse environmental affect due to rubber cultivation.
In Kerala, around 5 lakh hectares of land have been brought under natural rubber cultivation without any harm to environment, she claimed.
“There is a general perception that rubber cultivation would harm the environment but the natural rubber in no way harms the environment,” Ms Thomas said.
The Chairman further said that Tripura’s per hectare rubber production could be 40,000 kg which is almost double to the exsting productivily.
“For this, the farmers need to keep close relation with the experts of the Rubber Board. In turn, the Rubber Board needs to ensure supply of good planting materials,” she added.
The programme was organised to award best rubber producers’ society, best male rubber grower, best female rubber grower and best rubber tapper.
Industries Minister Jitendra Chowdhury, Chairman of Tripura Industrial Development Corporation Ltd (TIDC) Pabitra Kar, J Thomas, Rubber Production Commissioner, among others, were present in the programme.
December 7, 2011
The latest estimates of demand and supply of natural rubber (NR) by the Association of Natural Rubber Producing Countries (ANRPC) show the supply would be 5.6 per cent low in 2011 and 3.6 per cent in 2012.
The revised outlook suggests the total supply this year (January-December) will rise to 10.02 million tonnes (mt), up 5.6 per cent, but lower than the six per cent rate previously expected.
Early estimates by ANRPC indicate the price fall had started impacting the supply of the commodity. The global price of RSS-4 grade fell to Rs 174-175 a kg from Rs 185 a kg a month back. The average price in September was Rs 205 a kg. The decreasing trend in price is expected to affect the production of rubber. The total supply from member-countries of the ANRPC, which grew annually at 10.6 per cent in the first quarter and 10.7 per cent in the second, has slowed to 2.5 per cent in Q3, and is expected to do so further to 0.6 per cent in Q4.
ANRPC noted the supply of NR in the last quarter of 2010 was significantly down, and the forecast for the equivalent period in 2011 was only marginally above the reduced figure. The crisis in the euro zone has seriously affected output in most producing countries. ANRPC also estimates a three per cent fall in exports during October-December.
NR production increased five per cent during April-October. Total production increased to 480,700 tonnes as against 457,650 tonnes in the same period of last year. While consumption incre-ased to 551,425 tonnes as against 550,230 tonnes, the gap between production and consumption is likely to touch 150,000 tonnes.
Source: http://www.business-standard.com/india/news/natural-rubber-supply-to-fall-56-this-year/457872/
Tokyo futures drop, tracking oil, gold (Dec 9)
December 9, 2011
TOKYO, Dec 9 (Reuters) – Key Tokyo rubber futures fell 1.4 percent early on Friday, tracking losses in oil, gold and other commodities after comments from the head of the European Central Bank dashed hopes of more-dramatic action to fight the region’s debt crisis.
FUNDAMENTALS
* The key Tokyo Commodity Exchange rubber contract for May delivery <0#2JRU:> was changing hands at 286.9 yen per kg as of 0030 GMT, down 4.1 yen.
* On Thursday, the most active Shanghai rubber contract for May delivery fell 0.4 percent to close at 26,615 yuan per tonne. Volume stood at 808,000 lots.
* Crude oil futures fell for a second straight day on Thursday as disappointing comments from the head of the European Central Bank increased doubts among investors that the region’s debt crisis will be contained.
* The yen was steady against the dollar at 77.68.
* For the top stories in rubber market and other news, click, or
MARKET NEWS
* India’s carmakers may just break even in the fiscal year that ends in March, an industry body warned on Thursday and said it would cut its sales outlook for the year, as firms struggle with sluggish demand on rising input costs and high interest rates.
* Japan’s Nikkei average dropped on Friday after global shares slumped as steps from the European Central Bank disappointed some investors, and it flirted with key support at its 25-day moving average.
Most rubber defaulters new buyers from China – RTAS
December 7, 2011
SINGAPORE, Dec 7 (Reuters) – Inexperienced Chinese buyers have refused to take delivery of a bulk of the rubber shipped this year by major producers, but defaults are not as severe as in 2008, an official at the Rubber Trade Association of Singapore (RTAS) said on Wednesday.
The ASEAN Rubber Business Council, of which the RTAS is a member, has blacklisted buyers who defaulted on shipments and urged members to ignore requests for discounts following a plunge in prices.
“The defaulters this round are mainly new players to the rubber market who came in during the bull markets of 2009/2010 and who have not observed the sanctity of the contracts,” Benson Lim, a committee member of the RTAS, told Reuters by e-mail.
“The default situation this time round is not as bad as in 2008, and not 100 percent of the cases are related to Chinese buyers, who, however are the majority,” he added.
“Most of the older/established Chinese buyers are sticking to their contractual obligations despite the big price plunge.”
Buyers in China shocked the market late in 2008 when they refused to pay for their cargoes after prices tumbled by more than half due to the global financial crisis that hit automakers in Europe, North America and Japan hard.
Dealers’ estimates of these defaults varied from as little as 10,000 tonnes to as much as 200,000 tonnes, forcing officials from main producers Thailand, Indonesia and Malaysia to visit China to sort out the issue.
This year, cash rubber prices have halved since hitting a lifetime high at $6.40 a kg in February, on fears the debt crisis in Europe could hurt demand, and also because top consumer China told sellers they wanted to renegotiate prices.
The ARBC decided in a meeting in Hanoi at the weekend that it would act against defaulters, and asked members to stop dealing with them. It also said it had blacklisted defaulters and would eventually disclose their names to the public.
“The ARBC is still finalising the list as some members are still in the process of reporting some new cases,” said Lim.
The ARBC groups Thailand, Indonesia, Malaysia, Singapore, Vietnam and Cambodia. (Reporting by Lewa Pardomuan; editing by Miral Fahmy)
Tripura to face tough fight in rubber production
December 8, 2011
AGARTALA, Dec 8 – Tripura will face stiff competition in retaining second largest naturalrubber producing State tag if the production is not enhanced in the years to come, said Chief Minister Manik Sarkar.
Kerala, which has been contributing 82 per cent raw natural rubber in the country, has already been enjoying first position since a long time while Tripura’s position is secondwith only 8.2 per cent contribution.
Tripura will face tough challenge as many States have started showing interest in rubberplantation after suffering losses in the past, Sarakr said while speaking at a programmeorganized by the Rubber Board at Prajna Bhavan here.
Calling upon the experts of the Rubber Board to look into the problem that led to low productivity of natural rubber in the State, he said that the time has come to explore the full potential in the field of rubber cultivation.
Asserting that the rubber cultivation has been changing the face of rural economcy of the State, Sarkar said that there should be maximum efforts on the part of growers and experts on how to address the low production of natural rubber.
In her speech, Ms Sheela Thomas, the Chairman of the Rubber Board ruled out any adverse environmental affect due to rubber cultivation.
In Kerala, around 5 lakh hectares of land have been brought under natural rubber cultivation without any harm to environment, she claimed.
“There is a general perception that rubber cultivation would harm the environment but the natural rubber in no way harms the environment,” Ms Thomas said.
The Chairman further said that Tripura’s per hectare rubber production could be 40,000 kg which is almost double to the exsting productivily.
“For this, the farmers need to keep close relation with the experts of the Rubber Board. In turn, the Rubber Board needs to ensure supply of good planting materials,” she added.
The programme was organised to award best rubber producers’ society, best male rubber grower, best female rubber grower and best rubber tapper.
Industries Minister Jitendra Chowdhury, Chairman of Tripura Industrial Development Corporation Ltd (TIDC) Pabitra Kar, J Thomas, Rubber Production Commissioner, among others, were present in the programme.
Wednesday, December 7, 2011
Tokyo futures end up; 270-300 yen range seen
Tokyo futures end up; 270-300 yen range seen
Written by HMH | December 7, 2011 | 0 |
TOKYO, Dec 7 (Reuters) – Key TOCOM rubber futures ended higher on Wednesday, tracking rises in oil and the Shanghai market as the prospect of decreasing supply from some producing nations after January supported the downside.
The key Tokyo Commodity Exchange rubber contract for May delivery <0#2JRU:> settled up 7.1 yen or 2.5 percent at 291.6 yen per kg after touching the day’s high of 291.9 yen.
The most active Shanghai rubber contract for May delivery also closed up 2.5 percent, at 26,730 yuan per tonne. Volume stood at 904,120 lots.
“The price range has been gradually moving higher helped by the prospect of a supply shortage, but resistance will be solid around the 300 yen mark,” said Naoki Asami, a chief broker at trading house Kanetsu.
He expects the benchmark contract to move within a range of 270 yen to 300 yen for a while.
The market faces a seasonal decline in supply from some rubber producing nations after January, while tapping has been delayed in Thailand due to unseasonable rain, Asami said.
Buyers in China, the world’s biggest consumer, typically restock ahead of the Chinese New Year, which starts Jan. 22 this year, in anticipation of strong demand after the holiday season.
Indian rubber futures are likely to trade lower this week as domestic supplies rise in the peak production season while demand is subdued, analysts said.
U.S. crude oil futures added to gains slightly in post-settlement trading on Tuesday after data from the American Petroleum Institute showed a 5 million barrel crude stocks draw last week, much more than forecast.
The Nikkei average hit a four-week high on Wednesday as investors warmed to the view that European policy-makers will come up with convincing steps this week to help resolve the region’s debt crisis.
Written by HMH | December 7, 2011 | 0 |
TOKYO, Dec 7 (Reuters) – Key TOCOM rubber futures ended higher on Wednesday, tracking rises in oil and the Shanghai market as the prospect of decreasing supply from some producing nations after January supported the downside.
The key Tokyo Commodity Exchange rubber contract for May delivery <0#2JRU:> settled up 7.1 yen or 2.5 percent at 291.6 yen per kg after touching the day’s high of 291.9 yen.
The most active Shanghai rubber contract for May delivery also closed up 2.5 percent, at 26,730 yuan per tonne. Volume stood at 904,120 lots.
“The price range has been gradually moving higher helped by the prospect of a supply shortage, but resistance will be solid around the 300 yen mark,” said Naoki Asami, a chief broker at trading house Kanetsu.
He expects the benchmark contract to move within a range of 270 yen to 300 yen for a while.
The market faces a seasonal decline in supply from some rubber producing nations after January, while tapping has been delayed in Thailand due to unseasonable rain, Asami said.
Buyers in China, the world’s biggest consumer, typically restock ahead of the Chinese New Year, which starts Jan. 22 this year, in anticipation of strong demand after the holiday season.
Indian rubber futures are likely to trade lower this week as domestic supplies rise in the peak production season while demand is subdued, analysts said.
U.S. crude oil futures added to gains slightly in post-settlement trading on Tuesday after data from the American Petroleum Institute showed a 5 million barrel crude stocks draw last week, much more than forecast.
The Nikkei average hit a four-week high on Wednesday as investors warmed to the view that European policy-makers will come up with convincing steps this week to help resolve the region’s debt crisis.
Monday, December 5, 2011
India: No plans for further cut in natural rubber import duty
India: No plans for further cut in natural rubber import duty
December 4, 2011
NEW DELHI, DEC. 4:
The Centre has ruled out further reduction in import duty on natural rubber. Domestic tyre manufacturers had sought full customs duty exemption on natural rubber imports.
Since April 1 this year, natural rubber attracts basic customs duty of 20 per cent ad-valorem or Rs 20 a kilogram, whichever is lower. A further concessional rate of basic customs duty of 7.5 per cent ad-valorem has been provided to imports of natural rubber up to an aggregate quantity of 40,000 tonnes during financial year 2011-12. Natural rubber imports also attract special additional duty of 4 per cent ad-valorem.
“There is no proposal to carry out a further reduction in duty (import duty on natural rubber) at this stage,” Mr S.S. Palanimanickam, Minister of State for Finance, said in a written reply to a Lok Sabha question.
ATMA REQUEST
The request for full exemption of customs duty on natural rubber had been made by the Automotive Tyre Manufacturers’ Association (ATMA). Taking into account the interest of domestic growers, and the totality of factors, this request of ATMA has not been acceded to, the Minister said.
While the Centre had in July this year allowed imports of 40,000 tonnes of natural rubber at a concessional duty of 7.5 per cent for the current fiscal, a similar regime was allowed in December 2010 for last fiscal.
The move to allow imports at a lower duty followed demand from the user industry, particularly tyre manufacturers, who wanted the Centre to allow import of two lakh tonnes duty free. The Commerce Ministry had recommended allowing one-lakh tonnes duty free, but the Finance Ministry settled for 40,000 tonnes at concessional import duty of 7.5 per cent.
Market on Dec 02: Sheet rubber tops Rs 200 a kg
December 3, 2011
KOTTAYAM, DEC. 2:
Spot rubber prices continued to remain in the bullish orbit on Friday. On the spot, RSS 4 jumped to its highest since mid November tracking the overall gains on the National Multi Commodity Exchange (NMCE). According to observers, prices surged ahead mainly on covering purchases amidst low supplies as growers held their stocks even in the middle of the peak production season. Sheet rubber improved to Rs 200 (197) a kg, according to traders. The grade increased to Rs 199 (198) a kg both at Kottayam and Kochi, according to the Rubber Board.
The December series improved to Rs 203.20 (199.49), January to Rs 203.90 (200.10), February to Rs 204.65 (201.60), March to Rs 204.51 (202.25), April to Rs 207 (205.08) and May to Rs 210 (207.40) a kg on the NMCE.
RSS 3 (spot) dropped to Rs 175.63 (177.50) a kg at Bangkok. The December futures weakened to ¥259.2 (Rs 170.58) from ¥262.3 during the day session and then to ¥258.6 (Rs 170.20) a kg in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 200 (197); RSS-5: 197 (194); ungraded: 190 (188); ISNR 20: 182 (178) and latex 60 per cent: 110 (110).
Market on Dec 03: Spot rubber rules firm
December 4, 2011
Kottayam, Dec. 3:
Physical rubber prices finished firm on Saturday. The market improved reducing the gap with the December futures on the National Multi Commodity Exchange. Weekend covering purchases kept sheet rubber on the positive side and the grade increased to Rs 202 (200) a kg, according to traders. The trend was mixed.
Spot rates were (Rs/kg): RSS-4: 202 (200); RSS-5: 198 (197); ungraded: 192 (190); ISNR 20: 182 (182) and latex 60 per cent: 110 (110).
December 4, 2011
NEW DELHI, DEC. 4:
The Centre has ruled out further reduction in import duty on natural rubber. Domestic tyre manufacturers had sought full customs duty exemption on natural rubber imports.
Since April 1 this year, natural rubber attracts basic customs duty of 20 per cent ad-valorem or Rs 20 a kilogram, whichever is lower. A further concessional rate of basic customs duty of 7.5 per cent ad-valorem has been provided to imports of natural rubber up to an aggregate quantity of 40,000 tonnes during financial year 2011-12. Natural rubber imports also attract special additional duty of 4 per cent ad-valorem.
“There is no proposal to carry out a further reduction in duty (import duty on natural rubber) at this stage,” Mr S.S. Palanimanickam, Minister of State for Finance, said in a written reply to a Lok Sabha question.
ATMA REQUEST
The request for full exemption of customs duty on natural rubber had been made by the Automotive Tyre Manufacturers’ Association (ATMA). Taking into account the interest of domestic growers, and the totality of factors, this request of ATMA has not been acceded to, the Minister said.
While the Centre had in July this year allowed imports of 40,000 tonnes of natural rubber at a concessional duty of 7.5 per cent for the current fiscal, a similar regime was allowed in December 2010 for last fiscal.
The move to allow imports at a lower duty followed demand from the user industry, particularly tyre manufacturers, who wanted the Centre to allow import of two lakh tonnes duty free. The Commerce Ministry had recommended allowing one-lakh tonnes duty free, but the Finance Ministry settled for 40,000 tonnes at concessional import duty of 7.5 per cent.
Market on Dec 02: Sheet rubber tops Rs 200 a kg
December 3, 2011
KOTTAYAM, DEC. 2:
Spot rubber prices continued to remain in the bullish orbit on Friday. On the spot, RSS 4 jumped to its highest since mid November tracking the overall gains on the National Multi Commodity Exchange (NMCE). According to observers, prices surged ahead mainly on covering purchases amidst low supplies as growers held their stocks even in the middle of the peak production season. Sheet rubber improved to Rs 200 (197) a kg, according to traders. The grade increased to Rs 199 (198) a kg both at Kottayam and Kochi, according to the Rubber Board.
The December series improved to Rs 203.20 (199.49), January to Rs 203.90 (200.10), February to Rs 204.65 (201.60), March to Rs 204.51 (202.25), April to Rs 207 (205.08) and May to Rs 210 (207.40) a kg on the NMCE.
RSS 3 (spot) dropped to Rs 175.63 (177.50) a kg at Bangkok. The December futures weakened to ¥259.2 (Rs 170.58) from ¥262.3 during the day session and then to ¥258.6 (Rs 170.20) a kg in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 200 (197); RSS-5: 197 (194); ungraded: 190 (188); ISNR 20: 182 (178) and latex 60 per cent: 110 (110).
Market on Dec 03: Spot rubber rules firm
December 4, 2011
Kottayam, Dec. 3:
Physical rubber prices finished firm on Saturday. The market improved reducing the gap with the December futures on the National Multi Commodity Exchange. Weekend covering purchases kept sheet rubber on the positive side and the grade increased to Rs 202 (200) a kg, according to traders. The trend was mixed.
Spot rates were (Rs/kg): RSS-4: 202 (200); RSS-5: 198 (197); ungraded: 192 (190); ISNR 20: 182 (182) and latex 60 per cent: 110 (110).
Saturday, December 3, 2011
Sheet rubber tops Rs 200 a kg-Daily report on Natural Rubber: Dec 02, 2011
Sheet rubber tops Rs 200 a kg
KOTTAYAM, DEC. 2:
Spot rubber prices continued to remain in the bullish orbit on Friday. On the spot, RSS 4 jumped to its highest since mid November tracking the overall gains on the National Multi Commodity Exchange (NMCE). According to observers, prices surged ahead mainly on covering purchases amidst low supplies as growers held their stocks even in the middle of the peak production season. Sheet rubber improved to Rs 200 (197) a kg, according to traders. The grade increased to Rs 199 (198) a kg both at Kottayam and Kochi, according to the Rubber Board.
The December series improved to Rs 203.20 (199.49), January to Rs 203.90 (200.10), February to Rs 204.65 (201.60), March to Rs 204.51 (202.25), April to Rs 207 (205.08) and May to Rs 210 (207.40) a kg on the NMCE.
RSS 3 (spot) dropped to Rs 175.63 (177.50) a kg at Bangkok. The December futures weakened to ¥259.2 (Rs 170.58) from ¥262.3 during the day session and then to ¥258.6 (Rs 170.20) a kg in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 200 (197); RSS-5: 197 (194); ungraded: 190 (188); ISNR 20: 182 (178) and latex 60 per cent: 110 (110).
Daily report on Natural Rubber: Dec 02, 2011
December 2, 2011
HIGHLIGHTS
>RSS4 in local market hits three week high
> US and Indian car sales rise in Nov.
Commentary:
RSS 4 in the Indian markets jumped to its highest since early November this year tracking gains in the international market along with lower supplies to the market in the middle of peak arrival period. RSS4 in the physical market rose to Rs.197.50 a kg, to a three week high. However in the futures market, prices were seen edging lower after opening high. The most active January contract in NMCE rubber futures shoot up to 20270, its highest since November second week, but failed to sustain the gains. In the global markets, natural rubber inched lower on Friday after rallying in the previous session. Weak Chinese manufacturing and worries over Euro Zone debt issues continued to dominate the markets, almost shrugging off a strong manufacturing data from US. Still, fall in the natural rubber prices may probably limited as unfavorable weather in the top rubber producing countries, rise in auto sales in US and India. US auto sales rose 14 per cent to a two year high while Indian car companies posted double digit growth in sales in November expect for the major Maruti Suzuki.
ANALYSTS: Anu V Pai
Source: Geojit Comtrade Limited
KOTTAYAM, DEC. 2:
Spot rubber prices continued to remain in the bullish orbit on Friday. On the spot, RSS 4 jumped to its highest since mid November tracking the overall gains on the National Multi Commodity Exchange (NMCE). According to observers, prices surged ahead mainly on covering purchases amidst low supplies as growers held their stocks even in the middle of the peak production season. Sheet rubber improved to Rs 200 (197) a kg, according to traders. The grade increased to Rs 199 (198) a kg both at Kottayam and Kochi, according to the Rubber Board.
The December series improved to Rs 203.20 (199.49), January to Rs 203.90 (200.10), February to Rs 204.65 (201.60), March to Rs 204.51 (202.25), April to Rs 207 (205.08) and May to Rs 210 (207.40) a kg on the NMCE.
RSS 3 (spot) dropped to Rs 175.63 (177.50) a kg at Bangkok. The December futures weakened to ¥259.2 (Rs 170.58) from ¥262.3 during the day session and then to ¥258.6 (Rs 170.20) a kg in the night session on the Tokyo Commodity Exchange.
Spot rates were (Rs/kg): RSS-4: 200 (197); RSS-5: 197 (194); ungraded: 190 (188); ISNR 20: 182 (178) and latex 60 per cent: 110 (110).
Daily report on Natural Rubber: Dec 02, 2011
December 2, 2011
HIGHLIGHTS
>RSS4 in local market hits three week high
> US and Indian car sales rise in Nov.
Commentary:
RSS 4 in the Indian markets jumped to its highest since early November this year tracking gains in the international market along with lower supplies to the market in the middle of peak arrival period. RSS4 in the physical market rose to Rs.197.50 a kg, to a three week high. However in the futures market, prices were seen edging lower after opening high. The most active January contract in NMCE rubber futures shoot up to 20270, its highest since November second week, but failed to sustain the gains. In the global markets, natural rubber inched lower on Friday after rallying in the previous session. Weak Chinese manufacturing and worries over Euro Zone debt issues continued to dominate the markets, almost shrugging off a strong manufacturing data from US. Still, fall in the natural rubber prices may probably limited as unfavorable weather in the top rubber producing countries, rise in auto sales in US and India. US auto sales rose 14 per cent to a two year high while Indian car companies posted double digit growth in sales in November expect for the major Maruti Suzuki.
ANALYSTS: Anu V Pai
Source: Geojit Comtrade Limited
Thursday, December 1, 2011
‘Green’ tyres to make up 50% of Chinese market – Lanxess
‘Green’ tyres to make up 50% of Chinese market – Lanxess
December 1, 2011
Beijing, China — Lanxess AG expects sales of low-rolling resistance car tyres in China to increase from practically zero today to 50 percent of the market by the year 2020. China is the world’s largest car market and demand for car tyres (whether ‘green’ or not) is expected to rise by nine percent per year in the coming years. Around 400 million car tyres are produced in China each year – one-third of global tyre production.
The announcement was made at an event on the eve of the Lanxess Rubber day in Beijing tomorrow (2 December). At the same time, Lanxess CEO, Axel Heitmann said Lanxess expects group sales in China to exceed euro 1000 million in 2012.
The China Petroleum and Chemical Industry Federation (CPCIF) is the partner for Rubber Day China. The conference is also supported by the two Chinese industrial associations for rubber and synthetic rubbers, the German Institute of Rubber Technology (DIK), Beijing University of Chemical Technology and Qingdao University of Science and Technology (QUST). Around 350 representatives from business, academia, the media and local authorities will take part in the event, along with the German Ambassador to China, Dr. Michael Schaefer.
On the sidelines of the Rubber Day, Lanxess and the University of Qingdao are set to sign an agreement to extend their partnership, which has been in place since 2008. The primary aim of the individual agreements concluded by the Lanxess business units Technical Rubber Products and Butyl Rubber is to extend partnerships, with a view to supporting particularly talented students. Qingdao University is the center of rubber research in China.
Tokyo futures at 3-week high, may rise further
December 1, 2011
BANGKOK, Dec 1 (Reuters) – Tokyo rubber futures jumped 6.8 percent to a three-week high on Thursday on the back of surging share markets and oil prices and may rise further as sentiment improved after prices finished above a key resistance of 280 yen, dealers said.
The benchmark rubber contract on the Tokyo Commodity Exchange <0#JRU:> for May delivery rose 13.4 yen to settle at 280.8 yen ($3.62) per kg.
It rose as high as 18.3 yen, or 6.8 percent, to an intra-day high of 285.7 yen, the highest since Nov. 8.
The most-active rubber contract on the Shanghai commodity exchange for May delivery ended 1,135 yuan higher to finish at 25,925 yuan ($4,100) per tonne after jumping to its daily limit of 26,475 yan per tonne.
“TOCOM jumped in line with shares prices and may rise further on Friday if oil prices continue to rise,” one dealer said.
The Nikkei average surged to a two-week high on Thursday after the world’s central banks took coordinated action to ease funding strains among banks caused by the debt crisis in Europe.
Brent crude traded above $110 for the third session on Thursday after the move by the world’s major central banks and worry about sanctions against Iran.
Dealers said TOCOM prices could rise further on Friday with a 280 yen level was seen as strong support, while 290 yen could be the next resistance.
Market on Nov 30: Spot rubber improves on covering buys
November 30, 2011
KOTTAYAM, NOV. 30:
Spot rubber turned better on Wednesday. According to observers, the prices firmed up on covering purchases as sellers stayed back though there were no positive factors to revitalise the sentiments. Sheet rubber improved to Rs195.00 both at Kottayam and Kochi from Rs 194.00 and Rs193.00 a kg respectively according to traders and the Rubber Board. The trend was mixed.
In futures, the December series weakened to Rs 196.90 (197.10), January to Rs 197.80 (197.92), February to Rs199.61 (200.4), March to Rs200.50 (201.49) and April to Rs 203.00 (204.49) a kg for RSS 4 on National Multi Commodity Exchange (NMCE).
RSS 3 (spot) slipped to Rs 171.68 (171.90) a kg at Bangkok. The December futures weakened to ¥ 251.0 (Rs 168.32) from ¥ 253.5 during the day session but then remained inactive in the night session on Tokyo Commodity Exchange (TOCOM).
The spot rubber rates/kg follow RSS-4: 195.00 (194.00); RSS-5: 191.00 (191.00); Ungraded: 185.00 (183.00); ISNR 20: 176.00 (174.00) and Latex 60 per cent: 109.00 (109.00).
Growth in rubber output seen slowing next year
November 30, 2011
CHENNAI, NOV. 30:
Growth in the country’s rubber production next year is likely to be lower at 4.8 per cent compared with this year’s projected 5.8 per cent, according to the Association of Natural Rubber Producing Countries (ANPRC).
Rubber production next year is pegged at 9.44 lakh tonnes (lt), going by what the Government anticipates. This is against 9.01 lt this year when growth in production is estimated at 5.8 per cent. In fact, production growth increased by two percentage points this year, going by actual production figures up to August.
NATURAL RUBBER
Natural rubber trends put out by the ANPRC point out to an emerging bearish trend for growers, especially with consumption growth being lower this year.
In its short-term outlook, the ANPRC said: “Given the depth of the euro-zone crisis and its increasingly worsening situation, (the) possibility is remote for a marked reversal of the trend in NR-market in the short-term.”
The production growth globally, too, is seen lower at 3.6 per cent next year (at 10.38 million tonnes) compared with this year’s 5.6 per cent (at 10.02 million tonnes).
Growth in consumption next year is, however, seen higher at 3.1 per cent against this year’s 1.1 per cent. The ANPRC anticipates consumption in the country increased to 9.85 lt against 9.55 lt this year.
Globally, consumption could increase to 6.28 million tonnes (mt) from 6.09 mt, an increase of 3.1 per cent compared with this year’s 0.8 per cent.
EXPORTS
Exports this year are estimated higher at over 57,000 tonnes against 21,700 tonnes last year. Next year, shipments could drop to 40,000 tonnes. Global exports this year are seen at 7.57 mt against 7.47 mt last year. In 2012, they could increase to 7.81 mt.
Fortunately for Indian growers, over 90 per cent of who are small growers, imports are likely to be lower this year and next year. The ANPRC sees imports slipping to 1.33 lt from 1.97 lt last year. Next year, they could be down further to one lt.
Global imports, too, are seen dropping one per cent this year to 3.76 mt from 3.80 mt last year. However, they are likely to increase 1.5 per cent next year to 3.82 mt.
All this could see closing or carryover stocks in the country increase to 3.55 lt next year from 3.36 lt this year. Last year, the carryover stocks were 314.9 lt.
Given the average consumption of 80,000 tonnes a month, this year’s carryover stocks can meet demand for over four months and the next year, around four and a half months without a single tonne of natural rubber being tapped. The carryover stock with the nine ANPRC members is likely to be 1.27 million tonnes this year.
GLOBAL SCENARIO
The ANPRC said rubber prices are likely to be sluggish due to the global economic worries continuing. A higher stock level with China will also prove a dampener since producer countries are unlikely to see any demand from Chinese buyers.
Speculative interest is also likely to be lower in rubber until the Euro zone crisis is overcome and the weak currencies of Malaysia, Thailand and Indonesia will see poor interest from investors abroad, the ANPRC said.
A further rise in the yen against the dollar on the heels of the Japanese economy could also see rubber prices under pressure.
On the positive side, the lower prices could see growers uprooting older trees for replanting. Weather disruptions to tapping could see some movement but developments in the Euro zone are crucial to rubber economies, the association said.
Japanese car production up 20% on October 2010
November 30, 2011
Tokyo — Japan’s production of cars in October 2011 was substantially ahead of the same month in 2010, showing a significant recovery since the earthquake and tsunami which devastated the industry in March of this year. Motorcycle production was slightly down on the same period last year.
Automobile production in October 2011 was recorded as 904,247 units. Compared with the 751,420 units total recorded for the same month of the previous year, this is an increase of 152,827 units or 20.3 percent, and production increase on the same month of the previous year after last month’s downturn.
Automobile export in October 2011 was recorded as 472,022 units. Compared with the 417,030 units total recorded for the same month of the previous year, this is an increase of 54,992 units or 13.2 percent, and export increase on the same month of the previous year for three consecutive months.
Passenger car production was up across the board, with small cars up 37 percent and standard carts up 16 percent. Truck productin was up by over 30 percent compared with a year ago and large bus production was up by over 40 percent.
Motorcycle production in October 2011 was recorded as 56,220 units. Compared with the 58,205 units total recorded for the same month of the previous year, this is a decrease of 1,985 units or 3.4 percent, and production decrease on the same month of the previous year for two consecutive months.
Motorcycle export in October 2011 was recorded as 41,879 units. Compared with the 41,679 units total recorded for the same month of the previous year, this is an increase of 200 units or 0.5 percent, and export increase on the same month of the previous year for two consecutive months.
December 1, 2011
Beijing, China — Lanxess AG expects sales of low-rolling resistance car tyres in China to increase from practically zero today to 50 percent of the market by the year 2020. China is the world’s largest car market and demand for car tyres (whether ‘green’ or not) is expected to rise by nine percent per year in the coming years. Around 400 million car tyres are produced in China each year – one-third of global tyre production.
The announcement was made at an event on the eve of the Lanxess Rubber day in Beijing tomorrow (2 December). At the same time, Lanxess CEO, Axel Heitmann said Lanxess expects group sales in China to exceed euro 1000 million in 2012.
The China Petroleum and Chemical Industry Federation (CPCIF) is the partner for Rubber Day China. The conference is also supported by the two Chinese industrial associations for rubber and synthetic rubbers, the German Institute of Rubber Technology (DIK), Beijing University of Chemical Technology and Qingdao University of Science and Technology (QUST). Around 350 representatives from business, academia, the media and local authorities will take part in the event, along with the German Ambassador to China, Dr. Michael Schaefer.
On the sidelines of the Rubber Day, Lanxess and the University of Qingdao are set to sign an agreement to extend their partnership, which has been in place since 2008. The primary aim of the individual agreements concluded by the Lanxess business units Technical Rubber Products and Butyl Rubber is to extend partnerships, with a view to supporting particularly talented students. Qingdao University is the center of rubber research in China.
Tokyo futures at 3-week high, may rise further
December 1, 2011
BANGKOK, Dec 1 (Reuters) – Tokyo rubber futures jumped 6.8 percent to a three-week high on Thursday on the back of surging share markets and oil prices and may rise further as sentiment improved after prices finished above a key resistance of 280 yen, dealers said.
The benchmark rubber contract on the Tokyo Commodity Exchange <0#JRU:> for May delivery rose 13.4 yen to settle at 280.8 yen ($3.62) per kg.
It rose as high as 18.3 yen, or 6.8 percent, to an intra-day high of 285.7 yen, the highest since Nov. 8.
The most-active rubber contract on the Shanghai commodity exchange for May delivery ended 1,135 yuan higher to finish at 25,925 yuan ($4,100) per tonne after jumping to its daily limit of 26,475 yan per tonne.
“TOCOM jumped in line with shares prices and may rise further on Friday if oil prices continue to rise,” one dealer said.
The Nikkei average surged to a two-week high on Thursday after the world’s central banks took coordinated action to ease funding strains among banks caused by the debt crisis in Europe.
Brent crude traded above $110 for the third session on Thursday after the move by the world’s major central banks and worry about sanctions against Iran.
Dealers said TOCOM prices could rise further on Friday with a 280 yen level was seen as strong support, while 290 yen could be the next resistance.
Market on Nov 30: Spot rubber improves on covering buys
November 30, 2011
KOTTAYAM, NOV. 30:
Spot rubber turned better on Wednesday. According to observers, the prices firmed up on covering purchases as sellers stayed back though there were no positive factors to revitalise the sentiments. Sheet rubber improved to Rs195.00 both at Kottayam and Kochi from Rs 194.00 and Rs193.00 a kg respectively according to traders and the Rubber Board. The trend was mixed.
In futures, the December series weakened to Rs 196.90 (197.10), January to Rs 197.80 (197.92), February to Rs199.61 (200.4), March to Rs200.50 (201.49) and April to Rs 203.00 (204.49) a kg for RSS 4 on National Multi Commodity Exchange (NMCE).
RSS 3 (spot) slipped to Rs 171.68 (171.90) a kg at Bangkok. The December futures weakened to ¥ 251.0 (Rs 168.32) from ¥ 253.5 during the day session but then remained inactive in the night session on Tokyo Commodity Exchange (TOCOM).
The spot rubber rates/kg follow RSS-4: 195.00 (194.00); RSS-5: 191.00 (191.00); Ungraded: 185.00 (183.00); ISNR 20: 176.00 (174.00) and Latex 60 per cent: 109.00 (109.00).
Growth in rubber output seen slowing next year
November 30, 2011
CHENNAI, NOV. 30:
Growth in the country’s rubber production next year is likely to be lower at 4.8 per cent compared with this year’s projected 5.8 per cent, according to the Association of Natural Rubber Producing Countries (ANPRC).
Rubber production next year is pegged at 9.44 lakh tonnes (lt), going by what the Government anticipates. This is against 9.01 lt this year when growth in production is estimated at 5.8 per cent. In fact, production growth increased by two percentage points this year, going by actual production figures up to August.
NATURAL RUBBER
Natural rubber trends put out by the ANPRC point out to an emerging bearish trend for growers, especially with consumption growth being lower this year.
In its short-term outlook, the ANPRC said: “Given the depth of the euro-zone crisis and its increasingly worsening situation, (the) possibility is remote for a marked reversal of the trend in NR-market in the short-term.”
The production growth globally, too, is seen lower at 3.6 per cent next year (at 10.38 million tonnes) compared with this year’s 5.6 per cent (at 10.02 million tonnes).
Growth in consumption next year is, however, seen higher at 3.1 per cent against this year’s 1.1 per cent. The ANPRC anticipates consumption in the country increased to 9.85 lt against 9.55 lt this year.
Globally, consumption could increase to 6.28 million tonnes (mt) from 6.09 mt, an increase of 3.1 per cent compared with this year’s 0.8 per cent.
EXPORTS
Exports this year are estimated higher at over 57,000 tonnes against 21,700 tonnes last year. Next year, shipments could drop to 40,000 tonnes. Global exports this year are seen at 7.57 mt against 7.47 mt last year. In 2012, they could increase to 7.81 mt.
Fortunately for Indian growers, over 90 per cent of who are small growers, imports are likely to be lower this year and next year. The ANPRC sees imports slipping to 1.33 lt from 1.97 lt last year. Next year, they could be down further to one lt.
Global imports, too, are seen dropping one per cent this year to 3.76 mt from 3.80 mt last year. However, they are likely to increase 1.5 per cent next year to 3.82 mt.
All this could see closing or carryover stocks in the country increase to 3.55 lt next year from 3.36 lt this year. Last year, the carryover stocks were 314.9 lt.
Given the average consumption of 80,000 tonnes a month, this year’s carryover stocks can meet demand for over four months and the next year, around four and a half months without a single tonne of natural rubber being tapped. The carryover stock with the nine ANPRC members is likely to be 1.27 million tonnes this year.
GLOBAL SCENARIO
The ANPRC said rubber prices are likely to be sluggish due to the global economic worries continuing. A higher stock level with China will also prove a dampener since producer countries are unlikely to see any demand from Chinese buyers.
Speculative interest is also likely to be lower in rubber until the Euro zone crisis is overcome and the weak currencies of Malaysia, Thailand and Indonesia will see poor interest from investors abroad, the ANPRC said.
A further rise in the yen against the dollar on the heels of the Japanese economy could also see rubber prices under pressure.
On the positive side, the lower prices could see growers uprooting older trees for replanting. Weather disruptions to tapping could see some movement but developments in the Euro zone are crucial to rubber economies, the association said.
Japanese car production up 20% on October 2010
November 30, 2011
Tokyo — Japan’s production of cars in October 2011 was substantially ahead of the same month in 2010, showing a significant recovery since the earthquake and tsunami which devastated the industry in March of this year. Motorcycle production was slightly down on the same period last year.
Automobile production in October 2011 was recorded as 904,247 units. Compared with the 751,420 units total recorded for the same month of the previous year, this is an increase of 152,827 units or 20.3 percent, and production increase on the same month of the previous year after last month’s downturn.
Automobile export in October 2011 was recorded as 472,022 units. Compared with the 417,030 units total recorded for the same month of the previous year, this is an increase of 54,992 units or 13.2 percent, and export increase on the same month of the previous year for three consecutive months.
Passenger car production was up across the board, with small cars up 37 percent and standard carts up 16 percent. Truck productin was up by over 30 percent compared with a year ago and large bus production was up by over 40 percent.
Motorcycle production in October 2011 was recorded as 56,220 units. Compared with the 58,205 units total recorded for the same month of the previous year, this is a decrease of 1,985 units or 3.4 percent, and production decrease on the same month of the previous year for two consecutive months.
Motorcycle export in October 2011 was recorded as 41,879 units. Compared with the 41,679 units total recorded for the same month of the previous year, this is an increase of 200 units or 0.5 percent, and export increase on the same month of the previous year for two consecutive months.
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