Supply concerns, rising crude keep rubber steady
The October contract on the National Multi Commodity Exchange (NMCE) was trading at at Rs 89.50 per kg levels on Thursday evening against the previous close of Rs 88.78.
By NIDHI SHARMA, TNN |
MUMBAI: Rising crude oil prices and supply concerns due to rains are keeping the rubber prices steady, though prices were expected to fall in the domestic as well as international markets. The October contract on the National Multi Commodity Exchange (NMCE) was trading at at Rs 89.50 per kg levels on Thursday evening against the previous close of Rs 88.78.
The spot price at Kottayam closed at Rs 90.50, same as the previous close. The stock position in the NMCE warehouses is also adequate and as on Wednesday the closing balance was 271 tonnes. The open interest, which shows the demand for rubber, was around 1,600 tonnes levels.
The international markets, however, closed down on Thursday. Analysts attributed this fall mainly to technical correction on account of profit booking. Tocom rubber closed down 51 paise at Rs 87.63 per kg while the Malaysia spot market closed down 98 paise at Rs 84.97 per kg.
According to Geojit Commodities George Paul, there is no chance of rubber prices going down as stock position is low.
"Even if fresh supply begins, the stock position is likely to remain low as there was low production between August-September," Mr Paul said.
Locally, rubber tapping has started and if the weather remains clear, arrivals of latex will start next week which can bring down the spot prices. "The spot prices will be down as weather is getting clear and there could be fresh arrivals," said Kottayam-based rubber trader Bijosh P Thomas. He said imports of SMR 20 variety of rubber from Vietnam and Malaysia have started and on Thursday the Vietnam prices were Rs 85.63 per kg down from Wednesday’s day price of Rs 86.73.
Crude oil, at above $80 per barrel, is also maintaining the prices of rubber. Crude supports synthetic rubber prices which further provide support to natural rubber prices.
The spot price at Kottayam closed at Rs 90.50, same as the previous close. The stock position in the NMCE warehouses is also adequate and as on Wednesday the closing balance was 271 tonnes. The open interest, which shows the demand for rubber, was around 1,600 tonnes levels.
The international markets, however, closed down on Thursday. Analysts attributed this fall mainly to technical correction on account of profit booking. Tocom rubber closed down 51 paise at Rs 87.63 per kg while the Malaysia spot market closed down 98 paise at Rs 84.97 per kg.
According to Geojit Commodities George Paul, there is no chance of rubber prices going down as stock position is low.
"Even if fresh supply begins, the stock position is likely to remain low as there was low production between August-September," Mr Paul said.
Locally, rubber tapping has started and if the weather remains clear, arrivals of latex will start next week which can bring down the spot prices. "The spot prices will be down as weather is getting clear and there could be fresh arrivals," said Kottayam-based rubber trader Bijosh P Thomas. He said imports of SMR 20 variety of rubber from Vietnam and Malaysia have started and on Thursday the Vietnam prices were Rs 85.63 per kg down from Wednesday’s day price of Rs 86.73.
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Crude oil, at above $80 per barrel, is also maintaining the prices of rubber. Crude supports synthetic rubber prices which further provide support to natural rubber prices.
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