The dry season, which curbs output in
Thailand, Indonesia and Malaysia, has failed to support prices, with rubber
futures in Tokyo and Singapore holding near multi-year lows on fears about
economic growth in top consumer country. While some Chinese buyers may want to
buy on dips, overall demand is still weak due to the high inventory in
warehouses monitored by the Shanghai Futures Exchange.
India’s natural rubber imports jumped 49.3% to
324,467 tonnes in 2013-14, while production fell 7.6% to 844,000 tonnes and consumption
was largely steady at 977,400 tonnes, compared with 972,705 tonnes in 2012-13.
Today, the benchmark RSS4 grade rubber closed
at `.145 a kg at Kottayam. RSS3 grade closed at `.136.84
a kg at Bangkok and Malaysian SMR20 closed at `.109.49 a kg. On
Tokyo Commodity Exchange, April 2014 futures series closed at ¥223.5 a kg, May
at ¥223.5, June at ¥220.7, July at ¥215.6, August at ¥214.5 and the contract
for delivery in September 2014 closed at ¥213.7 a kg. On National Multi Commodity
Exchange, April 2014 futures closed at `.142.96 a kg, May at `.145.18,
June at `.148.03 and July at `.148.43 a kg. Rubber
Mini contract for May 2014 closed at `.144.70 a kg.
Prices could be under pressure as main
producer Thailand plans to sell 200,000 tonnes of rubber from state inventory
to replace lost output as farmers stop tapping trees during the dry season. There
are a lot of inquiries from China, but their bids are below $2 a kg.
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