Spot rubber ends steady

On Saturday (17 July 2010), the spot rubber prices were almost unchanged as the market managed to sustain at Friday's closing levels in most of the grades although the domestic futures ended lower in all contracts. Sheet rubber ended unchanged at Rs 180 per kg amidst scattered transactions.

The August futures for RSS 4 declined to Rs 170.44 (173.88), September to Rs 160.38 (164.66), October to Rs 157.91 (160.58) and November to Rs 157.92 (161) a kg on the National Multi Commodity Exchange.

Spot rates were (Rs/kg): RSS-4: 180 (180); RSS-5: 175 (175); ungraded: 170 (171); ISNR 20: 159 (159) and latex 60 per cent: 125 (126).

(indiainfoline.com)

Rubber Advances as Nearby Contract Surges on Low Stockpiles Due to Weather

Rubber futures climbed, led by a rally in the nearby contract amid speculation that low stockpiles in Japan may make physical delivery difficult at its expiry this month.

Futures in Tokyo gained for the second time this week. The nearby contract, which will expire on July 26, jumped as much as 2.8 percent, widening the price differential with the December- delivery futures, the most-active contract.

Natural rubber stockpiles monitored by the Tokyo Commodity Exchange dropped by 6.2 percent to 1,880 metric tons on June 30, nearing a record low of 1,408 tons reached in October 2008, according to exchange spokesman Seiki Ichimura. Supply decreased after rain disrupted tapping in Thailand, the world’s largest producer and exporter, said Kazuhiko Saito, an analyst at Tokyo- based broker Fujitomi Co.

“Tight supply is spurring a short-covering rally,” Saito said by phone today. Speculators with short, or sell, positions in the July contract must buy them back by July 26, the expiry date, unless they can deliver the raw material.

December-delivery rubber gained as much as 1.6 percent to 266.5 yen per kilogram ($3,056 a ton) before settling at 263.9 yen on the Tokyo Commodity Exchange. The price lost 3.3 percent this week, the second drop in three weeks.

July-delivery rubber gained as much as 2.8 percent to 357.5 yen before settling at 355 yen. Last month, the June-delivery contract expired at 372 yen.

Gains in futures were limited amid concern that a slowdown in economic growth in China, the largest consumer, may curb demand for the commodity used in tires, Saito at Fujitomi said.

Economic growth in China slowed to 10.3 percent in the second quarter from 11.9 percent in January-March, data showed yesterday. China’s expansion eased after the government tempered credit expansion, investment spending and property speculation.

November-delivery rubber on the Shanghai Futures Exchange gained 0.8 percent to 21,525 yuan ($3,177) a ton at 2:53 p.m. local time.

(bloomberg.com)

NMCE Rubber Quotes Lower In Afternoon Trades

Rubber futures in the domestic futures market traded with high volatility in today's trading sessions. The benchmark August contract on NMCE fell to the session low of Rs 17920 after hitting the high of Rs 18140 per 100 kg during the early trading session. The counter is now trading lower at Rs 18021, down Rs 57 from the last close.

TOCOM Commodity Exchange Rubber ended the morning session lower with benchmark December futures ending the session lower by 1.80 Yen at 262.40 Yen a kg. Futures rebounded from the losses in the later trading sessions on some buying interest. December futures contract is currently quoting in the TOCOM commodity exchange higher by 1.60 yen at 264 yen a kg.

The ANRPC lowered its forecast of growth for global supply of natural rubber for 2010 to 5.2% from the 6.1% rate anticipated in May, according to its June monthly bulletin released recently. The ANRPC had earlier in March anticipated a 6.3% rate of growth and had even then cautioned it to be an optimistic rate and pointed out a host of constraints in its achievement.

According to government and industry sources, India's imports of natural rubber will likely rise in the current fiscal year as local production is growing at a much slower pace than demand, mainly from tire makers.

Auto sales in both the U.S. and China continued to rise in June but at a slower pace than the previous month. China's auto sales surged 30.45% year on year to 7.18 million units in the first half of the year, keeping China's position as the world's largest auto market intact. U.S. auto sales also grew in June from thedepressed level of year earlier. Light vehicle sales rose 14% to 983,738 units in June compared to the last year.

(indiainfoline.com)

Decline in spot rubber prices

On Thursday (15 July 2010), the spot rubber prices declined as the trend setting domestic and international markers were bearish. Sheet rubber declined to Rs 184.25 from Rs 185 per kg, while the remaining grades except latex 60% also declined in with the day's sentiments.

The July futures for RSS 4 expired at Rs 187 (192.31), while the August series declined to Rs 179.95 (180.78), September to Rs 170.75 (171.86) and October to Rs 165.40 (166.51) a kg on the National Multi Commodity Exchange.

Spot rates were (Rs/kg): RSS-4: 184.25 (185); RSS-5: 179 (179.50); ungraded: 173.50 (174.50); ISNR 20: 161.50 (162) and latex 60 per cent: 128 (128).

(indiainfoline.com)

Rubber Declines as Oil’s Drop Cuts Appeal, Supply Increases

By Aya Takada

July 15 (Bloomberg) -- Rubber futures declined for a fourth day in five as a drop in oil reduced the appeal of the commodity as an alternative to synthetic products used in tires, and supply increased from Asian producing countries.

Futures in Tokyo decreased by as much as 1.3 percent, nearing a one-month low reached yesterday. The price pared losses as Shanghai’s rubber market climbed after data showed China’s economy expanded 11.1 percent in the first half.

Crude oil declined, cutting the cost of making rival synthetic rubber, after the Federal Reserve’s assessment that the economic outlook has “softened” added to concerns a recovery in demand may falter. Rubber futures were also capped by speculation supply from Southeast Asia will climb after data showed Malaysia’s output grew 20 percent.

“Rubber was curbed by uncertainty about economic outlook and seasonal increase in production,” Hisaaki Tasaka, an analyst at broker ACE Koeki Co. in Tokyo, said today by phone.

December-delivery rubber fell as much as 3.4 yen to 260.8 yen per kilogram ($2,955 a metric ton) before trading at 263.3 yen on the Tokyo Commodity Exchange at 11:49 a.m.

November-delivery rubber on the Shanghai Futures Exchange added 1 percent to 21,420 yuan ($3,161) a ton at 11:04 a.m. local time.

China Growth

China’s economic growth eased to 10.3 percent in the second quarter after the government succeeded in tempering credit expansion, investment spending and property speculation.

The pace compares with an 11.9 percent gain in January- March from a year earlier. Inflation cooled to 2.9 percent in June, the statistics bureau also reported in Beijing today. Industrial output rose a less-than-estimated 13.7 percent.

“The growth data from China, even though showing a slowdown in expansion, looks much better than developed economies,” Tasaka at ACE Koeki said.

The Federal Reserve cut its central forecast for growth this year to a range of 3 to 3.5 percent from 3.2 to 3.7 percent, and sales at U.S. retailers dropped for a second month, falling more than economists estimated.

Federal Reserve officials saw no need to boost stimulus to the economy while trimming their forecasts for growth and noting that risks to the recovery had increased, minutes of their June meeting showed.

“The economic outlook had softened somewhat and a number of members saw the risks to the outlook as having shifted to the downside,” minutes released yesterday in Washington said.

Malaysia’s natural rubber output reached 65,254 tons in May, rising 20 percent from April, data from the nation’s Department of Statistics showed yesterday. 

(bloomberg.com)

Rubber production expected to rebound with 9% growth

RUBBER PRODUCTION in the country is expected to increase by 9% this year in the face of revived demand, an Agriculture official said yesterday.

High Value Commercial Crops program director Rene Rafael C. Espino told reporters that "this year, rubber is seen to increase 9% [because of] high demand."

The increase is being projected even after rubber production dropped by 8.58% in the first quarter of the year to 58,240 metric tons (MT) from the 63,710 MT recorded in the same period in 2009, data from the Bureau of Agricultural Statistics (BAS) show. In 2009, production dipped 0.83% to 407,640 MT from 411,040 MT, the data showed.

Mr. Espino attributed the slump in the industry to dampened demand amid a global economic crisis. He said revived demand from recovering overseas markets is expected to be reflected in industry sales this semester.

Officers of the Philippine Rubber Industries Association, Inc. could not be reached to validate the department’s forecast, though the government reported last month that production of rubber and plastic products grew 22.5% in April.

Still, Mr. Espino cited the need to improve product quality. He said, the department plans to buy modern rubber processing equipment to help producers upgrade their products. "We are now trying to get equipment for the village-level processing in order for us to have better quality products," Mr. Espino said.

Mr. Espino said the department will purchase processing equipment that will transform cup lumps, which make up bulk of the country’s rubber products, into higher-value rubber sheets. This, in turn, is expected to raise demand for them for industrial and automotive use.

Mr. Espino said that most of the rubber plantations in the country are located in Mindanao, and that the department is looking at other areas. "We’re scouting for areas that will be very suitable for rubber now, we’re looking at Palawan as a potential area for expansion," Mr. Espino said.

He added that rubber plantations require investments of $2,500-$3,000 per hectare, which cover planting, harvesting and processing of the product.

To be sure, the government has long recognized the need to upgrade the country’s rubber products.

Last May, former president and now Pampanga Rep. Gloria M. Arroyo (2nd District) signed into law Republic Act No. 10089, forming the Philippine Rubber Research Institute -- to be based at the Mindanao State University in Naga, Zamboanga de Sibugay -- to provide research and development support to the industry.

Agriculture department data showed that the country’s rubber industry supplied just 1.05% of global demand in 2004. The industry lags behind counterparts in Indonesia and Malaysia, which started to plant rubber in 1905 -- around the same time as the Philippines.  

(bworldonline.com)

ANRPC lowers global rubber supply outlook for 2010

MUMBAI (Commodity Online): The ANRPC lowered its forecast of growth for global supply of natural rubber for 2010 to 5.2% from the 6.1% rate anticipated in May, according to its June monthly bulletin released recently. 

The ANRPC had earlier in March anticipated a 6.3% rate of growth and had even then cautioned it to be an optimistic rate and pointed out a host of constraints in its achievement. 

Auto sales in both the U.S. and China continued to rise in June but at a slower pace than the previous month. China’s auto sales surged 30.45% year on year to 7.18 million units in the first half of the year, keeping Chinas position as the world's largest auto market intact. U.S. auto sales also grew in June from the depressed level of year earlier. 

Light vehicle sales rose 14% to 983,738 units in June up from last year, Vietnam exported 239,000 tonnes of rubber worth US$656 million in the first half of the year, with earnings 82.5 per cent higher year-on-year, according to the general secretary of the Viet Nam Rubber Association. 

Tata Motors and Ashok Leyland have blamed the shortage of tyres in Indian market for increasing imports from China. The average monthly off take by OEMs in fiscal 2008 was 218 thousand tyres, which fell to about 144 thousand in fiscal 2009 due to the global slowdown. The figure recovered to 187 thousand in the last fiscal and for the first two months of the current year, demand has been at 230 thousand tyres a month. 

(commodityonline.com)