- Bearish sentiments continued to dominate the local natural rubber market. In the week gone by, quotes for RSS4 grade rubber in Kottayam market slipped and exchanged hands at its lowest in around 28 months. In the futures market, the most active August rubber futures in NMCE stretched losses for the third consecutive week and registered weekly decline of more than two per cent. Weak macro economic indicators, subdued demand and higher imports amidst increasing production drove prices lower.
- Intensifying worries over Euro Zone debt crisis dragged down natural rubber along with other commodities and equities in the international market on Monday. Shanghai rubber futures hit its daily limit-down while Tocom rubber futures shed more than four per cent to hit a three week low. Deteriorating financial health of Spain, the Euro Zone’s fourth largest economy heightened worries over worsening economic condition in the euro area.
- Indonesian tyre grade rubber traded below $3.0 a kg for nearby shipments; China’s presence almost nil.
- Rubber stocks in the warehouses monitored by Shanghai Futures Exchange declined 2.2 per cent to 18955 tonnes the previous week.
- Maruti Suzuki’s car manufacturing facility in Manesar, Haryana closed owing to labour unrest.
- Cambodia’s rubber latex exports rose five per cent to 22615 tonnes in the first six month of 2012 on a year on year basis.
- Indonesia is planning to set aside about $530 million to revitalise the state-owned rubber plantations.
- Thailand plans to double the budget for rubber purchases to 30 billion baht ($951 million) according to its Deputy Farm Minister.
- China’s GDP for the second quarter of 2012 recorded a growth of 7.6 per cent; it’s slowest in three years. Industrial production in June falls to 9.5 per cent from 9.6 per cent the previous month.
According to International Rubber Study Group, global natural rubber consumption is likely to expand less than previously forecast this year owing to economic slowdown in China and Euro Zone debt crisis.
RUBBER Aug NMCE
The bearish sentiments currently being witnessed is likely to continue in near term. 17850 pose to be the immediate support which once breached with considerable volume may see prices testing 17600-17500 region or even more in the near term. Now a break above 18250-18400 regions is required to bring mild positive bias.
Source: Geojit Comtrade
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