Daily report on Natural Rubber: May 19, 2015

MARKET COMMENTARY

Gains in the major overseas natural rubber market coupled with comments from the Kerala State Finance Minister on rubber procurement probably amidst limited supplies improved the market sentiments. RSS4 in the futures segment was seen inching higher on Monday and culminated the session nearly two per cent high. The commodity was seen ticking up in the physical market too. In the mean time, on Tuesday, natural rubber declined in the international market. TOCOM as well as SHFE rubber futures dipped after rising in the previous session probably on profit booking.

MARKET NEWS

China Rubber Industry Association has released self-disciplinary standards for “environmental protective” reclaimed rubber used in tires, according to a CRIA. The standards, made in reference to European Union regulations, aim to eliminate high-polluting processes and the use of hazardous materials such as coal tar.

Weekly data from SHFE showed rubber inventories in the warehouses monitored by the exchange rising 0.8 per cent last week to 128214 tonnes.

Vietnam rubber exports in April declined by 19 per cent on MoM basis to 52517 tonnes according to the country’s customs department.

Crude rubber inventories in the Japanese ports stood at 11825 tonnes as of April 30, up 6.5 per cent from the last inventory date (April 20), according to Rubber Trade Association of Japan.

Indonesia is aiming to boost domestic rubber consumption to around 1.24 million tonne in five years from the current level of 558,000 tn per annum according to Industry Minister Saleh Husin.

Natural rubber production in Indian declined 11.8 per cent in April to 45000 tonnes on year on year basis while imports surged by 28 per cent to 37250 tonnes.

The Stock Exchange of Thailand plans to team up with the Shanghai Futures Exchange (SHFE), China’s main futures market, to trade Thai rubber futures in a bid to increase the trading liquidity of Thai farm commodity futures. SET president Kesara Manchusree said agricultural commodity futures would be traded on the Thailand Futures Market (TFEX) in the second half of this year after the Agricultural Futures Exchange of Thailand (AFET) finishes merging with TFEX.

Finance Minister Arun Jaitly says the Center soon to raise the import duty on natural rubber to 25 per cent from the present 20 per cent.