World oil prices dropped with New York crude
taking a hit from disappointing US data. The price decline (currently trading
at US$107.05 a barrel at 5.54GMT) was triggered by weaker-than-expected
existing home sales in the US. The rubber market is expected to remain quiet
due to sluggish demand as China had slowed down purchases due to high domestic
inventories. Tyre manufacturers were using locally grown rubber for their
manufacturing purposes as it was cheaper due to oversupply and also building up
stocks for future use.
Every drop is supported by physical buying
and every rise is used by investors to cash out. On Tuesday, RSS4 grade rubber
closed at `.195 a kg at Kottayam. While on Wednesday, RSS3 grade
closed at `.153.11 a kg at Bangkok and Malaysian SMR20 closed at `.135.25
a kg. On the Tokyo Commodity Exchange, July futures series closed at ¥251,
August at ¥253.5, September at ¥254.3, October at ¥254.8, November at ¥255.4
and the contract for delivery in December closed at ¥257.1 a kg. National Multi
Commodity Exchange natural rubber futures witnessed negative trend and August
futures were trading at `.191.59, September at `.181.30, October at `.171.40
and November at `.164.97 a kg, at 12.20 pm.
Natural rubber prices are likely to rule firm
on soaring crude oil from which its alternative synthetic rubber is derived. Besides
supply and demand factors, the market will also be influenced by the
performance on the Tokyo Commodity Exchange and the Shanghai Futures Exchange.
Read
lot more in Rubber4U – 1st August 2013 issue
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