Daily report on Natural Rubber: August 24, 2012

MARKET COMMENTARY

• In the week gone by, natural rubber in the Indian market ruled mostly firm after bouncing back from its weakest level since September 2010. Despite selling pressure being witnessed in the market during the middle of the week, losses were limited. NMCE rubber futures managed to sustain the previous week’s gains while in the spot market RSS4 grade rubber ended a tad lower. Overall gains in other commodities and attempts by the top natural rubber producing countries to prop up prices lifted the sentiments.
• On Monday, natural rubber prices in the international market were on a rise bolstered by optimism that the leading central banks may take additional stimulus measures. Also, the top rubber producing countries are likely to meet during the first week of next month to seek measures to stabilise natural rubber prices which may keep prices in positive territory. TOCOM rubber futures hit a three week high, gaining more than three per cent earlier today.

MARKET NEWS

• According to Malaysian Rubber Board Chairman, the three major natural rubber producing countries – Malaysia, Indonesia and Thailand – will establish the mechanism to ensure that rubber price remains stable and competitive following a downtrend projection due to the current economic crisis faced by the euro zone countries. The meeting is also likely to be attended by China and India.
• Vietnam, the fourth-biggest rubber exporter in 2010, may ship 105,000 metric tons this month, according to figures today from the General Statistics Office in Hanoi, 30 percent more than in the same period last year.
• Rubber inventories in the warehouses monitored by SHFE rose 12.6 per cent to 28975 tonnes last week.
• Crude rubber stockpiles held at Japanese warehouses fell 14.1 percent to 7,993 metric tons on Aug. 10, according to data from the Rubber Trade Association of Japan.
• Thailand is planning to spend an additional 15 billion baht on rubber in rubber intervention. So far, around 80000 tonnes of rubber has been procured from the farmers under the program.

TECHNICAL VIEW

RUBBER Sep NMCE

Prices have approached the resistance region of 16900-17050 and successful attempts to sustain above 17050 will diminish the prevailing broad negative sentiments and may see prices testing 17250-17370 or more. Alternatively, 16580 will be a crucial level down side, if breached, may see a fall towards 16450-16370, but requires to break 16370(200-week moving average) convincingly to evolve into another major sell off.

Source: Geojit Comtrade

Download this report (full content – PDF file) bellow: