Monday, March 28, 2016

Encouraging factors push up prices


The natural rubber futures are gaining here on price-supporting measures by producing countries, with the August contract for a benchmark product trading at a seven-month high on the Tokyo Commodity Exchange.

The most actively traded September contract closed at ¥180.5 per kg, higher than the recent low in early February. Prices are also climbing because many producing countries are entering the dry season; output is expected to drop about 20% till May. The price of crude oil, which is used to make synthetic rubber, is on the rise. Thailand, Indonesia and Malaysia plans to cut total exports by 615,000 tonnes over the six months starting in March will also help in pushing up prices. Recently, Indonesian government announced that it will buy 500,000 tonnes of natural rubber.

The benchmark RSS4 grade rubber closed at `.114 a kg at Kottayam, while RSS3 grade closed at `.101 a kg at Bangkok and Malaysian SMR20 closed at `.89.13 a kg. On National Multi Commodity Exchange April 2016, the futures closed at `.117.66 a kg, May at `.119.01 and June 2016 closed at `.120.39 a kg. Tokyo Commodity Exchange April 2016 futures series closed at ¥170.7 a kg, May 2016 at ¥172.1, June at ¥174.8, July at ¥177.5, August at ¥179.3 and the contract for delivery in September 2016 closed at ¥180.5 a kg. On Tuesay, most probably Tocom futures contract for delivery in September 2016 may trade in the range of ¥182 & ¥176 a kg.

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

Friday, March 25, 2016

Initiative by Indonesia


At the launch of a replanting program the Indonesian government said government agencies and state owned companies will buy 500,000 tonnes of locally produced rubber to help support rubber prices. The government gave no details on the timing of the purchases. The government would provide subsidised loans to farmers to replant 1 million hectares of rubber plantation between 2016 and 2019.

The benchmark RSS4 grade rubber closed at `.113 a kg at Kottayam, while RSS3 grade closed at `.101.36 a kg at Bangkok and Malaysian SMR20 closed at `.87.19 a kg. On National Multi Commodity Exchange April 2016, the futures closed at `.116.61 a kg, May at `.118.39 and June 2016 closed at `.119.33 a kg. Tokyo Commodity Exchange March 2016 futures series closed at ¥167 a kg, April at ¥166, May 2016 at ¥168.4, June at ¥170, July at ¥173 and the contract for delivery in August 2016 closed at ¥175.3 a kg.

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

Thursday, March 10, 2016

Market linked insurance for plantation


Indian government is likely to initiate a market linked insurance scheme for plantation crops, which will be implemented on a pilot basis in 7 districts and will provide insurance cover against fluctuation in prices and yield. The revenue insurance scheme for plantation crops will be launched once the operational parameters are finalised by the government. The scheme will be funded from the price stabilisation fund for plantation crops.

While addressing at the India Rubber Meet 2016 in Goa, the event organised by the Rubber Board in partnership with stakeholder associations in rubber and related sectors, the Rubber Board chairman, A Jayathilak said excessive import of rubber products including tyres, often on account of dumping and tariff concessions offered under Free Trade Agreements (FTAs), is a critical issue. Rubber is one of the most critical, strategic and versatile raw materials in the modern world and will remain so the in the foreseeable future. Its demand and prices are positively linked to economic growth. Link between the industry and economic growth brings in fortunes during booms and hardships during busts.

According to Rubber4U estimate, domestic industry will have to face volatile situations. Currently, when the crude oil is trading at its recent low level, petrol price has not come down comparatively, due to increase in taxes. At this juncture auto sector is struggling to sustain. Think when these prices start shooting up; inflation will increase, sales quantity will decrease, so the raw material demands. But natural rubber price is expected to move to a level of `.150 a kg. As we have earlier forecasted that natural rubber price will touch `.92 a kg level, this too is also expected to happen.

The benchmark RSS4 grade rubber closed at `.107 a kg at Kottayam, while RSS3 grade closed at `.98.55 a kg at Bangkok and Malaysian SMR20 closed at `.87.30 a kg. On National Multi Commodity Exchange March 2016, the futures closed at `.105.17 a kg, April at `.108.22, May at `.110.36 and June 2016 closed at `.111.41 a kg. Tokyo Commodity Exchange March 2016 futures series closed at ¥160.4 a kg, April at ¥164, May 2016 at ¥166.7, June at ¥168.4, July at ¥170.1 and the contract for delivery in August 2016 closed at ¥171.4 a kg. On Friday, most probably Tocom futures contract for delivery in August 2016 may trade in the range of ¥174 & ¥168 a kg.

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