Thursday, December 31, 2015
Wednesday, December 30, 2015
Gloomy year comes to an end with little sparkle
After plunging 48% in 2014, the crude oil price
has fallen another 36% since the end of last year. Rubber product makers and
exporters may continue to see growth as natural rubber prices may continue to
stay low because of low crude oil prices.
Global demand for natural rubber is slowing
as the economy cools in China. Supplies are expanding after a decade-long rally
in rubber prices to a record in 2011 encouraged top producers like Thailand,
Indonesia and Vietnam to plant more trees. Output will exceed use for two more
years, with the surplus quadrupling in 2016. Global production is set to exceed
demand by 411,000 tonnes next year and by 430,000 tonnes in 2017, compared with
a surplus of 98,000 tonnes in 2015, according to The Rubber Economist Ltd., a
London based industry researcher.
Rubber traded in Tokyo has tumbled 71% from a
record in 2011, touching a six-year low of ¥153 a kg on 6th November 2015. Tokyo
rubber prices climbed more than 14% to 174.8 yen at the beginning of December
from a six-year low of ¥153 a kg. The Tokyo Commodity Exchange rubber dropped
to a one-month low on 29th December, stretching its losses into a fourth
consecutive session, as slowing demand from top consumer China and weakness in
crude oil.
Crude oil prices still remained under
pressure on fears of slowing demand added to worries over near-record global
production levels. Natural rubber prices often follow moves in crude oil as the
commodity competes with synthetic rubber and the market is concerned about
slowing economic growth in China.
United Planters Association of Southern India
(UPASI) has said cheap imports are harming the rubber industry. It wants the
government to introduce safeguards to protect domestic players. "With
damage to domestic industry being evident, government should play its role as
regulator and introduce safeguards to limit imports. The recommendations of the
Parliamentary Standing Committee on the rubber industry in India have clearly
stated that uncontrolled imports are harming the growing domestic
industry," said Dharmaraj, president of UPASI.
The benchmark RSS4 grade rubber closed at `.102.50
a kg at Kottayam, while RSS3 grade closed at `.79.94 a kg at
Bangkok and Malaysian SMR20 closed at `.75.60 a kg. On
National Multi Commodity Exchange January 2016 futures closed at `.103.91
a kg, February at `.105.70 and March closed at `.108.04
a kg. On Tokyo Commodity Exchange, January 2016 futures series closed at ¥147.3
a kg, February at ¥149.9, March at ¥153.1, April at ¥166.6, May at ¥157.7 and
the contract for delivery in June 2016 closed at ¥159 a kg. It is definitely
going to be an interesting year in 2016 in terms of the economy and financial
markets.
To read Rubber4U – 1st
January 2016 issue: http://rubber4u.com/Public/Abcd.pdf
for latest forecast
Monday, December 14, 2015
Friday, December 11, 2015
NR output and imports down
Natural rubber imports in November 2015
dropped nearly -13.72% to 32,308 tonnes from 37,445 tonnes in November 2014. Import
of natural rubber was mainly from Indonesia, Thailand, Vietnam and Malaysia.
Natural
rubber production for the month of November 2015 decreased by 16.67% to 50,000
tonnes compared to 60,000 tonnes during November 2014. While the consumption during
the month decreased by 3.87% to 82,000 tonnes compared to 85,300 tonnes during
the same period of 2014.
The benchmark RSS4 grade rubber closed at `.103
a kg at Kottayam, while RSS3 grade closed at `.86.33 a kg at
Bangkok and Malaysian SMR20 closed at `.77.53 a kg. On
National Multi Commodity Exchange December 2015 futures closed at `.100.27
a kg, January 2016 at `.101.80, February at `.102.18 and March closed
at `.103.69 a kg. On Tokyo Commodity Exchange, December 2015
futures series closed at ¥157.8 a kg, January 2016 at ¥161.3, February at ¥162.4,
March at ¥164.9, April at ¥166.5 and the contract for delivery in May 2016
closed at ¥168 a kg.
To read Rubber4U – 15th December
2015 issue: http://rubber4u.com/Public/Abcd.pdf
Visit
Us at Rubber World Expo 2015 at B-34, BEC, Goregaon-Mumbai, India.
Saturday, December 5, 2015
Demand to regulate rubber imports
The persistent fall in the prices in the past
two years had caused concern among rubber growers in Kerala. Kerala government has
asked Centre to regulate import of natural rubber and hike excise duty to check
its falling prices in domestic market. Recently, Kerala government had introduced
a support scheme whereby small-scale rubber growers would get an assured price
of `.150 per kg. The State government's commitment towards
this scheme would come to around `.300 crore in the
current fiscal and it would go up to `.500 crore next year.
The problem of low-cost imports is putting at
risk the entire ‘Make in India’ clarion call by the Indian government. According
to Mohinder Gupta, president of All India Rubber Industries Association, much
higher import duties on raw materials such as natural and synthetic rubbers
than on finished rubber goods have impacted the export competitiveness of the
rubber sector in India. Import duty should be zero for the rubber and raw
materials not being manufactured in the country. The proposed national rubber
policy is still a work-in-progress. The meetings of the working group formed
for framing national rubber policy are over. Different stakeholders have made
their submissions. We have requested the government to come out with the policy
as soon as possible.
Through bilateral friendly consultations in
Thailand, Sinochem and Rubber Authority of Thailand (RAOT) signed a purchase
agreement of 200,000 tonnes of natural rubber, which is the largest order in
2015.
The benchmark RSS4 grade rubber closed at `.105
a kg at Kottayam, while RSS3 grade closed at `.85.34 a kg at Bangkok
and Malaysian SMR20 closed at `.77.97 a kg. On
National Multi Commodity Exchange December 2015 futures closed at `.105.38
a kg, January 2016 at `.105.49 and February closed at `.106.16
a kg. On Tokyo Commodity Exchange, December 2015 futures series closed at ¥161.8
a kg, January 2016 at ¥165.1, February at ¥167.3, March at ¥169, April at ¥169.8
and the contract for delivery in May 2016 closed at ¥170.7 a kg.
To read Rubber4U – 15th December
2015 issue: http://rubber4u.com/Public/Abcd.pdf
Visit
Us at Rubber World Expo 2015 at B-34, BEC, Goregaon-Mumbai, India.
Thursday, December 3, 2015
Little relief but still in crisis
Rubber growers in Kerala were bearing the
brunt of rubber imports, leading to a fall in price in the domestic market. Today
during the Zero Hour, Lok Sabha MPs from Kerala backed the Congress leader Anto
Antony’s demand for immediate intervention from the Centre to arrest rising
imports of natural rubber. Home Minister Rajnath Singh assured the agitated MPs
that he would take up the matter with the Minister concerned.
U.S. manufacturing contracted in November for
the first time in three years as the sector buckled under the weight of a
strong dollar and deep spending cuts by energy firms, but robust automobile
sales suggested the economy remained on solid ground.
An industry survey showed Manufacturing
activity in China hit a three year low in November, supporting the case for
more accommodative policies as authorities seek to prop up growth.
While benchmark TOCOM rubber futures hit a 6 week
high on Thursday, helped by an overnight jump in Shanghai futures and as investor’s
unwound short positions on the view that prices may be bottoming out.
Today the benchmark RSS4 grade rubber closed
at `.105 a kg at Kottayam, while RSS3 grade closed at `.85.34
a kg at Bangkok and Malaysian SMR20 closed at `.77.97 a kg. On
National Multi Commodity Exchange December 2015 futures closed at `.104.88
a kg, January 2016 at `.104.84, February at `.105.16 and March closed
at `.106.02 a kg. On Tokyo Commodity Exchange, December 2015
futures series closed at ¥161.8 a kg, January 2016 at ¥165.1, February at ¥167.3,
March at ¥169, April at ¥169.8 and the contract for delivery in May 2016 closed
at ¥170.7 a kg. On Friday, most probably Tocom futures contract for delivery in
May 2016 may trade in the range of ¥168 & ¥172 a kg.
To read Rubber4U – 1st December
2015 issue: http://rubber4u.com/Public/Abcd.pdf
Visit
Us at Rubber World Expo 2015 at B-34, BEC, Goregaon-Mumbai, India.
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