Is price heading towards Rs.130 a kg mark

Global natural rubber production will continue to outpace demand over the next two years. World output may rise 1.1% to 12.2 million tonnes this year against consumption of 11.5 mn tonnes. International prices continue to slide and expected to remain under pressure in near future, as global natural rubber surplus this year will be 78% higher than estimated as demand growth weakens and production in Thailand surpasses forecasts.

In a statement, Thailand’s government has informed the International Rubber Consortium Ltd. that Thai government has not made any decision to sell its current natural rubber stocks at prevailing market prices. The government will only consider selling them if the market price of natural rubber is appropriate.

Today, the benchmark RSS4 grade rubber closed at `.138 a kg at Kottayam. RSS3 grade closed at `.123.51 a kg at Bangkok and Malaysian SMR20 closed at `.102.15 a kg. On Tokyo Commodity Exchange, April 2014 futures series closed at ¥196 a kg, May at ¥198.9, June at ¥200.5, July at ¥200.5, August at ¥201.1 and the contract for delivery in September 2014 closed at ¥201.6 a kg. On National Multi Commodity Exchange, May 2014 futures were trading at `.138.50 a kg, June at `.140.60, July at `.141.60 and August at `.141.44 a kg. Rubber Mini contract for May 2014 was trading at `.139.75 and June at `.140 a kg, at 16.15 IST.

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Read lot more in Rubber4U – 1st May 2014 issue