Sunday, February 28, 2016

Lots of expectations, will it get fulfilled?


Union Budget 2016-17 will be presented on 29th February and industry expects to see a blueprint that would strengthen the demand scenario and would be focused on pushing the Indian economy to the targeted GDP growth. Finance minister Arun Jaitley faces a tough task of balancing the needs of farm sector as well as the industry when he presents his third Budget. On the tax front, the Budget may continue with the status quo, while it may tinker with the exemptions.

While the fortune of the Indian tyre industry is knotted with the performance of the automotive sector. With economic activity gathering pace and the RBI ushering in monetary easing, it could boost consumer sentiment. The domestic production of natural rubber is insufficient to meet the growing demand; import dependence will remain for quite some time, as the gap is widening. But it should not be at the cost of hurting domestic business, especially when the industry is going through a manufacturing slump. Demand for tyres is expected to accelerate in 2016-17. Industry expects this budget to help boost demand and keep the industry momentum going.

The Association of Planters of Kerala wanted amendments in the Plantation Labour Act, which mandates the provision of housing, sanitation and medical care facilities to workers. While Indian Rubber Dealers Federation has urged the Centre to enhance the replanting subsidy to `.1 lakh per hectare from the present `.20,000. Growers seek a temporary ban on imports till a safeguard duty is levied.

Automotive Tyre Manufacturers Association (ATMA) said the existing curbs on natural rubber import are restricting them from sourcing the raw material at competitive prices at a time when domestic output is declining sharply. In view of such steep fall in natural rubber production, imports are a must to meet the growing demand of tyres from auto and transport sectors. High import duties on natural rubber and much lower duties on finished tyres is leading to indiscriminate surge in import and dumping of tyres in India.

Don’t expect much on Monday.

The benchmark RSS4 grade rubber closed at `.96.50 a kg at Kottayam, while RSS3 grade closed at `.89.42 a kg at Bangkok and Malaysian SMR20 closed at `.78.03 a kg. On National Multi Commodity Exchange March 2016, the futures closed at `.98.53 a kg, April at `.101.94 and May 2016 closed at `.103.90 a kg. Tokyo Commodity Exchange March 2016 futures series closed at ¥147.4 a kg, April at ¥149.5, May 2016 at ¥152.3, June at ¥153.9, July at ¥155.2 and the contract for delivery in August 2016 closed at ¥155.6 a kg. On Monday, most probably Tocom futures contract for delivery in August 2016 may trade in negative range of ¥153 & ¥158 a kg.

To read Rubber4U – 1st March 2016 issue: http://rubber4u.com/Public/Abcd.pdf
For 2015-16 Rubber Forecast: http://rubber4u.com/Public/RForecast.pdf

Saturday, February 20, 2016

NR production down, while import increased


India’s natural rubber production for the month of January 2016 decreased by 3.45% to 56,000 tonnes compared to 58,000 tonnes during January 2015. While the consumption during the month decreased by 2.21% to 82,000 tonnes compared to 83,850 tonnes during the same period of 2015. Natural rubber stock decreased by 2.42% to 242,000 tonnes from 248,000 tonnes in January 2015.

Natural rubber imports in January 2016 increased 20.70% to 35,174 tonnes from 29,141 tonnes in January 2015. Import of natural rubber was mainly from Indonesia, Thailand, Vietnam and Malaysia.

The benchmark RSS4 grade rubber closed at `.94.50 a kg at Kottayam, while RSS3 grade closed at `.87.62 a kg at Bangkok and Malaysian SMR20 closed at `.75.24 a kg. On National Multi Commodity Exchange March 2016, the futures closed at `.97.39 a kg, April at `.100.40 and May 2016 closed at `.102.72 a kg. Tokyo Commodity Exchange February 2016 futures series closed at ¥141 a kg, March at ¥144.4, April at ¥147.3, May 2016 at ¥150.6, June at ¥152.7 and the contract for delivery in July 2016 closed at ¥153.2 a kg.

To read Rubber4U – 1st March 2016 issue: http://rubber4u.com/Public/Abcd.pdf
For 2015-16 Rubber Forecast: http://rubber4u.com/Public/RForecast.pdf

Thursday, February 18, 2016

Market to remain weak


Automotive Tyre Manufacturers' Association (ATMA) the most active industry bodies representing `.50,000 crore automotive tyre industry has elected K M Mammen, chairman & managing director of MRF Ltd. as Chairman of ATMA. While Satish Sharma, president (Asia Pacific, Middle East and Africa) of Apollo Tyres Ltd. has been elected as Vice Chairman.

The moves by major natural rubber exporters to limit shipments could assist in the near-term, but a significant price movement in the coming months is not expected. The rubber market will continue to struggle with an overhang of stocks, encouraged by economic slowdown in China and weak oil prices which enhance the competitiveness of synthetic rubber. The negative economic sentiment and low petroleum prices will not support an increase in natural rubber demand.

The benchmark RSS4 grade rubber closed at `.94 a kg at Kottayam, while RSS3 grade closed at `.87.55 a kg at Bangkok and Malaysian SMR20 closed at `.75.14 a kg. On National Multi Commodity Exchange February 2016, the futures closed at `.198.02 a kg, March at `.101.13, April at `.102.43 and May 2016 at `.104.07 a kg. Tokyo Commodity Exchange February 2016 futures series closed at ¥142.6 a kg, March at ¥144.6, April at ¥147.6, May 2016 at ¥150.6, June at ¥152.4 and the contract for delivery in July 2016 closed at ¥152.6 a kg.

To read Rubber4U – 1st March 2016 issue: http://rubber4u.com/Public/Abcd.pdf
For 2015-16 Rubber Forecast: http://rubber4u.com/Public/RForecast.pdf

Thursday, February 4, 2016

Future outlook


Rubber Skill Development Council (RSDC) and Tripura University has signed a Memorandum of Understanding (MoU) for conducting a programme called Bachelor of Vocation (B.Voc) in Rubber Technology. The three year course is approved by the University Grants Commission under the Ministry of Human Resource Development. The MoU was signed by Vinod T Simon, chairman of RSDC, and O S Adhikari, registrar of Tripura University.

A fourteen member delegation led by Mohinder Gupta, president of All India Rubber Industries Association, supported by the MSME ministry, is visiting Japan during 8-12 February 2016 for exploring trade and investment opportunities in rubber sector. Both the countries are among the world’s largest producers of rubber and rubber products.

The benchmark RSS4 grade rubber closed at `.91.50 a kg at Kottayam, while RSS3 grade closed at `.85.73 a kg at Bangkok and Malaysian SMR20 closed at `.75.48 a kg. On National Multi Commodity Exchange February 2016 futures closed at `.91.66 a kg, March at `.93.76, April at `.96.04 and May closed at `.97.73 a kg. On Tokyo Commodity Exchange, February 2016 futures series closed at ¥152 a kg, March at ¥150.5, April at ¥152.9, May at ¥156, June at ¥157.2 and the contract for delivery in July 2016 closed at ¥157.3 a kg. On Friday, most probably Tocom futures contract for delivery in July 2016 may trade in negative range of ¥153 & ¥156 a kg.

To read Rubber4U – 15th February 2016 issue: http://rubber4u.com/Public/Abcd.pdf
For 2015-16 Rubber Forecast: http://rubber4u.com/Public/RForecast.pdf

Wednesday, February 3, 2016

Peaceful hartal


LDF has called for a hartal in Kottayam district demanding measures to be taken to save the rubber farmers. LDF activists took out protest marches in many places in the district. The dawn to dusk hartal was peaceful but partial. While buses remained off the road and shops remained closed, private vehicles could be seen in large numbers on the road.

The benchmark RSS4 grade rubber closed at `.92 a kg at Cochin, while RSS3 grade closed at `.85.14 a kg at Bangkok and Malaysian SMR20 closed at `.73.60 a kg. On National Multi Commodity Exchange February 2016 futures closed at `.91.05 a kg, March at `.93.03, April at `.95.34 and May closed at `.99.50 a kg. On Tokyo Commodity Exchange, February 2016 futures series closed at ¥148.7 a kg, March at ¥149, April at ¥150.5, May at ¥153.5, June at ¥154.1 and the contract for delivery in July 2016 closed at ¥153.6 a kg. On Thursday, most probably Tocom futures contract for delivery in July 2016 may trade in the range of ¥153 & ¥160 a kg.

To read Rubber4U – 1st February 2016 issue: http://rubber4u.com/Public/Abcd.pdf
For 2015-16 Rubber Forecast: http://rubber4u.com/Public/RForecast.pdf