Daily report on Natural Rubber: August 13, 2012

MARKET COMMENTARY

-  NMCE rubber futures posted one of its worst weekly declines the previous week since early June this year, with the most active September rubber futures shedding more than five per cent. RSS4 slumped to its weakest since September 2010 in both futures as well as in the spot market owing to subdued demand from the major natural rubber consuming industries and ample inventory in the midst of rising domestic natural rubber production and uncertain economic outlook.

-  On Monday, in the international market, natural rubber traded mostly steady with a negative bias. Disappointing Chinese data released the previous week kept prices under pressure, although expectations of monetary stimulus from the top consumer limited losses. TOCOM and Shanghai rubber futures opened lower while AFET remained closed.

MARKET NEWS

-  Japan’s weather agency says ‘El Nino’ phenomenon has already emerged and is likely to last until winter.

-  Rubber inventories in the warehouses monitored by SHFE rose 21.8 per cent to 26316 tonnes the previous week.

-  China’s natural rubber imports in July at 170,000 metric tonnes, 6.3 per cent up on MoM basis.

-  Natural rubber production in India rise 2.6 per cent to 66,000 tonnes in July on YoY basis. Consumption increases slightly to 83,000 tonnes while imports fall to 17084 tonnes from 19928 tonnes during the same period last year.

-  According to SIAM, passenger car sales rises in July by 6.71 per cent on YoY while commercial vehicles and three wheelers put up a modest growth.

-  Apollo Tyres considering to invest Rs.300 crores in Kalamassery unit, Kerala to set up an export –oriented unit.

-  According to International Rubber Study Group, global demand for both natural and synthetic rubber is seen rising four per cent to 27.7 million tonnes in 2013 on a year on year basis.

TECHNICAL VIEW

 RUBBER Sep NMCE A consolidation in 16900-16500 regions is in progress with negative bias after the recent steep plunge. Even as the broad trend remains bearish, 16500-16300 region seems to be considerably strong supports which it requires to clear for another leg of bear moves. Else, a consolidation followed by a bounce back probably towards 17250 initially can be witnessed.

Source: Geojit Comtrade

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