Crude oil prices fell on Wednesday after
hitting three-week peaks as global demand worries trumped supply concerns
linked to simmering tensions in the crude-rich Middle East. After reaching
almost three-week highs, at $93.66, the New York WTI contract tumbled into
negative territory in late trade in a technical correction heightened by demand
fears.
Rubber market also seems to be witnessing a
correction after rallying higher in the recent weeks. However, fundamentals
remain supportive, as stimulus measures are likely to raise demand.
RSS4 grade rubber in India closed with a
negative note around `.190 a kg and the price of RSS3 grade closed at `.173.95
per kg at Bangkok. In the domestic futures market, the October series closed at
`.191.66, November at `.186.40, December at `.185.04
and January 2013 at `.186.58 a kg on the National Multi Commodity Exchange. On
the Tokyo Commodity Exchange, October futures series currently trading in
negative at ¥260.8 per kg and March 2013 at ¥267.9 per kg, on 11th
October.
The three major rubber producing countries
had agreed in August to cut down rubber trees and trim exports by 300,000
tonnes, in an attempt to curb declining global rubber prices, which came into effect
on 1st October 2012. The government will bear the holding cost for the rubber
industry, if exporters need to stop selling, in a move to support the price.
Malaysian Minister of Plantation Industries
and Commodities, Tan Sri Bernard Dompok said that the tripartite agreement
between Thailand, Indonesia and Malaysia would cut off 300,000 tonnes in
proportion with the rubber we produced. Price mechanism would kick in should
the tyre-grade SMR20 fall below US$2.70 per kg.
Read
lot more in Rubber4U – 15th October 2012 issue
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