Tokyo futures drop near 3-year low on demand fears (Aug 13)

Tokyo futures drop near 3-year low on demand fears (Aug 13)
August 13, 2012




SINGAPORE, Aug 13 (Reuters) – Tokyo rubber futures fell to their weakest in nearly three years on Monday on worries about slowing demand and the debt crisis in Europe, while losses in China’s equity market helped push Shanghai futures to a contract low.

The most-active Tokyo Commodity Exchange rubber contract for January delivery settled down 5.0 yen a kg at 213.9 yen, its weakest since October 2009, after earlier hitting an intraday high of 219.3 yen.

“Even though oil prices are high, the rubber market is technically week. If it breaks the 200 yen support level, then I think things will look bad,” said a dealer in Kuala Lumpur.

“Nobody is chasing rubber because people think prices could fall again.”

Oil, which often influences TOCOM contracts, firmed on Monday, with Brent rising above $114 per barrel to its highest in more than three months, as Israeli comments on stopping Iran from proceeding with a disputed nuclear programme stoked worries about a disruption in supplies from the region.

Weaker TOCOM and declines in Shanghai shares weighed on the rubber market in China. The most-active rubber contract on the Shanghai Futures Exchange for January delivery slipped more than 3 percent to a contract low of 21,590 yuan a tonne.

Chinese imports of key commodities, such as iron ore and copper, held up better than expected in July, but weak trade figures and a nine-month low in crude oil imports painted a picture of a slowing economy.

Shanghai shares suffered their worst daily loss in nearly a month on Monday, dragged down by steep losses in shares in Chinese brokerages.

In other markets, weak Japanese economic data tempered European investors’ optimism about ECB plans to tackle the euro zone crisis, with stocks down slightly and the euro flat.

The front-month September rubber contract on Singapore’s SICOM exchange was last traded at 250.5 U.S. cents per kg, down 8.70 cents.




India Rubber prices hit 21 month low on weak demand
August 12, 2012




KOTTAYAM, INDIA (Commodity Online): Rubber prices in India recorded a sharp fall in prices in recent months as industrial growth has slowed down due global financial crisis.

In the physical market, RSS 4 grade rubber prices are at 21- month low due to economic slowdown, weak monsoon which keeps rubber market under pressure.

NMCE rubber futures have shown weak performance with the most active September rubber futures hitting weakest level since September 2010 shedding nearly three per cent.

Sheet rubber recorded a decline in its prices from Rs.177 to Rs. 175.50 per kg. The grade rubber prices are also fell to Rs.176 from 177.50 per kg as reported by the rubber board.

In the National Multi Commodity Exchange August series improved to Rs. 173.50 (173.02) and September to Rs. 167.90 (167.64) while the October series dropped to Rs. 167.52 (167.65), November to Rs. 167.25 (168.51) and December to Rs. 171.64 (178.79).





India: As economy slides, truck sales enter slow lane
August 12, 2012



Domestic truck sales seem to be mirroring the current slowdown. Thanks to slow industrial activity and goods movement, medium and heavy truck sales have fallen 18% to 71,456 so far in the current fiscal year. Fearing a further decline in demand, manufacturers have also slashed production by 27% to 74,000 during the April-July period.

Market leader Tata Motors seemed to be the worst hit, with its medium and heavy commercial vehicle sales falling 22% during the period.

“The low GDP rate is one reason,” said Ravi Pisharody, executive director, Tata Motors. “Certain sectors are facing challenges. For instance, the mining sector is in a standstill, affecting truck sales in a big way.”

With goods movement also decreasing, truck rentals have gone down by as much as 11-13% in the current fiscal year.

This has resulted in truck operators turning away from dealers despite discounts of up to Rs. 2.5 lakh and finance schemes offering 5.5-6.5% interest rate, said SP Singh, co-ordinator, Indian Foundation of Transport Research & Training.

“If the freight market does not improve, there is possibility of repossession of delinquent trucks,” he said.

During the downturn in 2008-09, more than 40000 trucks were repossessed for non payment of loan by fleet owners.