Expecting further fall in rubber prices

Natural rubber continues to remain in a weak territory. The developments in Greece, Italy and uncertainty over global economic growth, eroded all the optimism that prevailed in the market. The reports of high inventories and Chinese buyers wanted to renegotiate contracts after NR prices fell below $4 a kg. and tracking global markets, natural rubber prices in the Indian market plunged too. The most active Dec Futures on NMCE closed at 205.64 a kg, while in the physical market RSS4 closed at Rs. 200 a kg.

Natural rubber prices turned weak, as global economic uncertainty is casting dark shadows over its demand, there is no selling pressure from dealers or growers and the market lost ground on buyer resistance. Sentiments were also affected by the fall in stocks and commodities around the globe, though the local markets still experienced short supplies. Spot market prices dropped tracking sharp losses on the National Multi Commodity Exchange (NMCE). At NMCE, rubber future prices for November delivery closed at Rs 205.64 per kg and at Rs. 206.50 per kg for March 2012 delivery. RSS4 grade closed at Rs. 200 a kg at Kottayam, RSS3 grade natural rubber in the international market at Bangkok closed at Rs 180.20 per kg, SMR-20 closed at 176.36 a kg at Kuala Lumpur. At Tokyo Commodity Exchange futures prices for November delivery closed at ¥273 a kg, for December delivery closed at ¥275 a kg and ¥280.2 a kg for March 2012 contract.

On 1^st November, we have forecasted that NR price in the domestic market once again will fall to Rs. 198 per kg in near future, when the NR prices were at Rs. 212 per kg.

Read lot more in Rubber4U – 15th November 2011 issue