Spot rubber shrinks on profit booking

Kottayam, Dec 28

Spot rubber lost ground on Tuesday. Sharp declines on TOCOM following profit booking at higher levels and signs of weakness in domestic futures were the contributing factors. Reports on the resumption of tapping in key plantation areas and the expectations of an improvement in arrivals kept the sentiments weak though the market still experienced short supply. The trend continued to be mixed.

Sheet rubber moved down to Rs 206 (207) a kg, according to dealers. The grade weakened to Rs 206.75 ( 207.50) a kg both at Kottayam and Kochi, as quoted by the Rubber Board.

RSS 4 slipped with the January series dropping to Rs 209.50 (209.66), February to Rs 214 (214.47), March to Rs 217.99 ( 218.82) and April to Rs 224.39 (224.62) a kg on the National Multi Commodity Exchange.

RSS 3 (spot) closed weak at Rs 224.04 (224.57) a kg in Bangkok. January futures for the grade declined to ¥401.5 (Rs 220.74) from ¥411.2 during the day session but then remained inactive in the night session on the Tokyo Commodity Exchange.

Physical rubber rates (Rs/kg) were: RSS 4: 206 (207), RSS 5: 199 ( 202), Ungraded: 195 (197), ISNR 20: 204 (204) and Latex 60 per cent : 137 (137).

(Source: http://www.blonnet.com/2010/12/29/stories/2010122950991600.htm)

Ananta: Rubber will stay above 100 baht

Increased Asia demand will keep prices high

Rubber prices are expected to stay well above 100 baht per kilogramme thanks to increasing demand from growing economies in Asia, says Ananta Dalodom, president of the Horticultural Society of Thailand.

Demand has shifted to China from the United States and Japan during the past three years, making it the largest importer at 2.7 million to 2.8 million tonnes, driven by high growth in the automotive sector, said Dr Ananta, a former director-general of the Agriculture Department.

Demand from India also keeps rising due to its economic growth, as India plans to construct roads covering up to 200,000 kilometres using natural rubber as part of the material.

Raw rubber sheet prices are now quoted at 138 baht per kg, while smoked ribbed rubber sheets No 3 (RSS3) were trading yesterday in the Hat Yai cash market at 149.55 baht, with latex at 131 baht per kg.

Rubber prices have been rising steadily since 2002 when the raw rubber sheet price was 29.15 baht per kg, RSS3 was 30.23 baht and latex 30.49 baht.

"The prices are very high and have shown no signs of declining. Prices should remain at least 100 baht per kg from now on," said Dr Ananta.

Thailand, the world's largest exporter, produces around 3 million tonnes per year, accounting for 40% of world production, followed by Indonesia and Malaysia.

Dusit Rojanawanitchakorn, the owner of a 500-rai rubber plantation in Chon Buri province, said he now earned 1.5 million baht per month compared with an average of 800,000 baht per month last year, when prices of the raw rubber sheet during the same period were 90 baht per kg.

"These are the highest prices I've ever seen, and I think it will stay this way for at least two years," said Mr Dusit, adding that current prices were reasonable.

Kanda Chamchumrus, who owns a rubber processing plant, disagrees, saying the price surge is due mainly to speculation by large factories selling their products at high prices, which distorts prices and does not represent the real market.

"I have heard from rubber planters that they do not want excessive prices because they are afraid the system will fall through, as this will prompt users to shift to substitute products," said Mrs Kanda.

Prayong Hirunyawanich, chairman of the Federation of Thai Industries' natural rubber and rubberwood cluster club, said rising rubber prices had increased costs for businesses.

"Manufacturers cannot raise their product prices to pass on the higher costs, as the Commerce Ministry has called for price freezes to try to curb inflation," he said.

(Source: http://www.bangkokpost.com/business/economics/213400/ananta-rubber-will-stay-above-100-baht)

Record price for Sri Lanka rubber

Dec 27, Colombo: Sri Lanka Rubber Development Board reports a record price for the sheet rubber.

A kilo of first grade sheet rubber was sold at Rs. 521 at the auction, said Director General of the Rubber Development Board R.B. Athapattu. A kilo of first grade sheet rubber was sold at Rs. 230 at the beginning of 2010.

Sheet rubber of the lower grades was also sold at comparatively higher prices, the Director General said.

Meanwhile a kilo of crape rubber was sold at Rs. 598 per kilo at the auction.

Sri Lanka is currently receiving a good demand for natural rubber.

The Director General of the Rubber Development Board said the demand was due to decline of rubber harvest in other rubber exporting countries.

(Source: http://www.colombopage.com/archive_10C/Dec27_1293463816KA.php)

IRCo's WEEKLY MARKET SNAPSHOT: 20 - 24 December 2010

IRCo's DCP rose consecutively during the week and stayed at 491.11 US cents/kg on Friday. Both rubber futures and physical markets also moved in the same direction due mainly to the extension of firm market fundamentals, high crude oil futures, and positive sentiment about continued growth of the global economy next year. The National Development and Reform Commission of China said on Friday that it would order price surveillance authorities to keep prices of agricultural products stable over the coming year. This announcement should make Chinese rubber manufacturers more comfortable with the coming year of the Rabbit.

Asian stock markets still stayed on an upward trend on Friday on the back of strongly economic growth and continued inflows of cheap money from the West, while European stock markets still showed uncertainty in the wake of tough austerity measures of many European countries on Thursday ahead of the Christmas holiday. On the contrary, the Dow Jones Industrial Average rose to a fresh two-year closing high on Thursday as U.S. consumers were more optimistic about the U.S. economy for the coming year that partially pulled up crude oil futures on Nymex to hit fresh two-year highs at US$91.51 per barrel on Thursday.

The People's Bank of China (PBOC) unexpectedly raised the one-year lending and deposit rates by 25 basis points each on Saturday, Christmas day, to curb borrowing, rein in property prices, and tame inflation. The move took the rates to 5.81% and to 2.75% respectively from Sunday. The PBOC repeated that a variety of tools will be used, including interest rate hikes and tighter lending restrictions, over the next 12 months to curb inflation and to prevent an asset price bubble. Currently faster growth in emerging and developing economies than advanced economies is slowly leading their currencies to strengthen further next year.

(Source: http://www.irco.biz/MarketWise.php)

Rubber price Update: 24 December 2010

Rubber price Update: 24 December 2010

(Source: Irco.biz)

TYPE	21-Dec	20-Dec	(+/-)	Compared to 1 week ago	Compared to 1 month ago	Compared to 1 year ago
DCP (US cents/kg)	491.11	489.32	+1.79	+48.50	+63.47	+222.43
14-Day Moving Average of DCP (US cents/kg)	467.01	463.54	+3.47	+35.14	+40.42	+214.39
FUTURES MARKETS
TOCOM/RSS3 (Yen/kg)
- Feb 11	410.00	-	-	+41.40	-	+166.70
- Jun 11	416.60	-	-	+38.60	-	+163.50
SHFE/RSS3 (Yuan/ton), May 11	37,045	37,035	+10	+4,295	+4,225	+14,895
SICOM (US cents/kg)
- RSS3, Feb 11	496.00	493.50	+2.50	+44.00	+63.00	+222.50
- TSR20, Feb 11	494.50	489.00	+5.50	+52.50	+72.50	+225.60
AFET (THB/kg)
- RSS3, Jun 11	149.00	147.45	+1.55	+14.10	+21.95	+57.70
PHYSICAL MARKETS (US cents/kg)
SIR20 (FOB/Palembang), Jan 11	-	490.00	-	-	-	-
SMR20 (FOB), Jan 11	-	481.85	-	-	-	-
RRIT (THB/kg)
RSS3 (FOB/BKK), Jan 11	149.30	148.80	+0.50	-	+16.30	+59.45
STR20 (FOB/BKK), Jan 11	148.75	148.25	+0.50	-	+18.05	+59.95
Conc. Latex (FOB/BKK), Jan 11	95.05	94.80	+0.25	-	+7.20	+38.30
USS3 (Hat Yai), Jan 11	138.46	136.68	+1.78	-	+19.25	+56.95
Field latex (Hat Yai), Jan 11	133.00	133.50	-0.50	-	+9.00	+53.00

Hainan Rubber to raise RMB 4.71 bln from Shanghai IPO

Dec. 27, 2010 (China Knowledge) - Hainan Rubber Industry Group Co Ltd, a leading agricultural industrialization enterprise in China, today announced that it will raise up to RMB 4.71 billion from an initial public offering in Shanghai, Reuters reported.
The company said in a statement that it will issue 786 million shares via both online and offline placement at a price ranging from RMB 5.50 to RMB 5.99 apiece.
Hainan Rubber has hired CITIC Securities Co<600030> as underwriter for the offering.
The company plans to use RMB 1.33 billion from the proceeds for rubber farms replantation projects.
Hainan Rubber Industry Group is the largest producer of natural rubber in China, the world's largest natural rubber consumer. In the first nine months of this year, it realized revenue of RMB 388 million, while its net profit for last year was RMB 286 million.

(Source: http://www.chinaknowledge.com/Newswires/News_Detail.aspx?type=1&cat=INV&NewsID=39872)

Commodity Outlook for Rubber by KediaCommodity

Rubber ended the week higher on the back of increasing crude oil price to the highest level in more than two years, resulting boosting the cost of making rival synthetic products. Moreover, the rubber's supply is expected to decline more in next year as the low production season will starts in Thailand in next year. Therefore, overseas buyers, mainly from China, India and Japan, have started buying ahead of New Year holidays and the low production season in order to secure their supply. In yesterday's trading session Rubber has touched the low of 20871 after opening at 20950, and finally settled at 21280. For today's session market is looking to take support at 21007, a break below could see a test of 20735 and where as resistance is now likely to be seen at 21416, a move above could see prices testing 21553.

Trading Ideas:

Rubber trading range is 20735-21553.

Rubber ended the week higher on the back of increasing crude oil price and supply concern

Rubber weekly stocks at Shanghai exchange came up by 4133 tonnes.

Spread between Rubber JAN & FEB contracts yesterday ended at 470.00. Spread yesterday traded in the range of 470 to 540.

NMCE accredited warehouses Rubber stock rosed by 196kgs to 5334kgs.

(Source: http://www.topnews.in/commodity-outlook-rubber-kediacommodity-2301215)