Singapore (february 27, 2011) : tyre makers bought some quantity of indonesian rubber and demand from trading houses in southeast asia also stirred up trading, but main consumer china was on the sidelines although physical prices had dropped from record highs, dealers said on thursday.
indonesian sir20 was traded on thursday at 244 us cents a pound ($5.38 a kg) for may shipment. late on wednesday, sir20 for april delivery changed hands at 245.00 and 246.50 cents a pound ($5.40 and $5.43 a kg), with buyers including japan's largest tyre maker bridgestone. sir20 was traded at all time high of 262 cents last week.
"tyre makers such as bridgestone and goodyear are still looking for rubber but china is so quiet. sometimes you just can't rely on them," said a dealer in indonesia's main growing island of sumatra. tyre grade prices slipped from all time high after tokyo rubber futures, which set the tone for physical prices, dropped on concerns over demand from china after the lunar new year celebration.
dealers said tyre makers in china turned to domestic supply, which was sold at discount to tyre grade in southeast asia, but purchases from other consumers were still steady.
malaysia smr20 grade was sold at $5.54 a kg for april, but there were no reports of deals for thai rss3, which was offered at $6.36 a kg on thursday. "i guess china is waiting for the price to fall further. they are usually very quiet whenever the market tumbles," said a dealer in singapore.
tokyo rubber fell 1.7 percent on thursday as investors booked profits from recent record highs, while shanghai futures dropped nearly 3 percent, but tight supply because of the seasonal dry season in producing countries and strong oil prices offered support.
"at the lower price levels for rubber, routine buying activity is again seen from tyre majors in singapore for april and may loadings," said another dealer in singapore. "noticeably, march rubber is not freely available. volumes in the chinese and japanese rubber markets indicate that both profit-taking and position-rolling have featured heavily."
weekahead dealers expected buyers to buy on dips next week, although gains in tokyo futures were likely to lift prices again because of soaring oil prices. "i think nearby shipment is fully committed, and we can only offer shipment for april, may and june," said a dealer in singapore. "i think demand from china is slow because of high inventory of tyres there. they seem to be having difficulties in selling them. that's why they are reluctant to buy at this point of time." brent oil surged over 7.5 percent to its highest since august 2008 on concern the unrest that has cut more than a quarter of opec-member libya's crude output could spread to other major producers, including top exporter saudi arabia.
Sunday, February 27, 2011
Asian rubber: tyre makers chase april cargo; china stays away
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