Current oil prices have dropped dramatically
in the last few months. According to Citigroup report, US oil prices may
plummet to a new 11 year low of $33 a barrel or lower this year. While in 2008,
during the global financial crisis US crude traded at a low of $30.28 a barrel.
West Texas Intermediary crude closed at $38.24 a barrel on Monday. The
international benchmark, Brent crude, was also down and closed at $42.69 a
barrel. The slump is helping oil importers but hurting producers and all over
the world it is holding back the inflation that is needed to justify an
increase in interest rates.
Lower prices of oil and equity markets as
well as the yen’s rise against the U.S dollar all added to the pressure. Natural
rubber accounts for the second largest commodity import to the US after
petroleum and it’s one of the top five natural rubber importers globally. In
terms of overall sustainability, guayule is a multi-use, zero waste crops.
After the rubber is extracted, the leftover biomass can be used as fuel or to
extract biochemicals.
The benchmark RSS4 grade rubber closed at `.113
a kg at Kottayam, while RSS3 grade closed at `.93.46 a kg at
Bangkok and Malaysian SMR20 closed at `.81.99 a kg. On
National Multi Commodity Exchange September 2015 futures closed at `.111.46
a kg and October at `.111.55 a kg. On Tokyo Commodity Exchange, August 2015
futures series closed at ¥165.5 a kg, September at ¥166.9, October at ¥170,
November at ¥172.1, December 2015 at ¥173.8 and the contract for delivery in January
2016 closed at ¥175.1 a kg. On Tuesday, most probably Tocom futures contract
for delivery in January 2016 may trade in the range of ¥165 & ¥176 a kg.
To read Rubber4U – 1st September
2015 issue: http://rubber4u.com/Public/Abcd.pdf
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