Rubber Market to Stay Strong on Supply, Group Says (Update2) - By Supunnabul Suwannakij
May 25 (Bloomberg) -- Rubber demand from India and China and tight supply after the low-production season will help keep the market strong, the Association of Natural Rubber Producing Countries said.
Demand in China, India and Malaysia, which account for more than 45 percent of global consumption, should stay robust, the association said in its May newsletter.
Natural-rubber imports by China rose 17 percent to 602,000 tons from January to April, and demand, including that of compound rubber, increased 26 percent to 1.05 million tons, according to the association, which represents 94 percent of global output of the commodity. Consumption of natural rubber in India during the first four months jumped 12 percent to 316,000 tons, it said.
Futures in Tokyo plunged 20 percent since reaching a 21- month high of 338.5 yen a kilogram ($3,777 a metric ton) on April 16. The most-active contract gained 1.7 percent last week after dropping to a five-month low of 250.9 yen on May 17. Rubber for October delivery, the most-active contract, fell 2.2 percent to settle at 271 yen on the Tokyo Commodity Exchange.
The International Rubber Consortium Ltd. forecast yesterday that natural rubber prices are likely to stay around current levels, because of increasing demand and a lack of shipments from Thailand.
Tight supplies from the main producing countries after the post-wintering season will support prices, the Association of Natural Rubber Producing Countries said. Trees shed their leaves during the wintering season that runs from February to April, lowering latex output.
The association today maintained the output forecast for its member countries at 9.37 million tons this year, a rise of 6.2 percent from 2009, it said.
The association represents Cambodia, China, India, Malaysia, Indonesia, Papua New Guinea, Philippines, Singapore, Sri Lanka, Thailand and Vietnam.
--Editor: Ravil Shirodkar, Tim Coulter
To contact the reporter on this story: Supunnabul Suwannakij in Bangkok at ssuwannakij@bloomberg.net
To contact the editor responsible for this story: James Poole in Singapore at jpoole4@bloomberg.net
Related News -
Rubber Advances to Three-Week High as Oil Gains, Yen Declines - By Aya Takada and Supunnabul Suwannakij
May 27 (Bloomberg) -- Rubber advanced for a second day to the highest level in three weeks as a rally in crude oil and limited supplies from Thailand, the largest producer, boosted demand for the commodity used to make tires.
Futures in Tokyo were also bolstered by a fall in Japan’s currency against the dollar, which raised the appeal of yen- denominated contracts. The yen weakened as signs that Asia- Pacific economies are recovering sapped demand for Japan’s currency as a refuge.
“Overall sentiment is bullish” given the gains in oil and other commodities, Kazunori Kokubo, general manager of the international business department at commodity broker Yutaka Shoji Co., said by phone from Tokyo.
Rubber for November delivery, the most-active contract on the Tokyo Commodity Exchange, rose as much as 3 percent to 281.90 yen per kilogram ($3,122 a metric ton) before settling at 281.3 yen. Earlier, it fell to 272 yen on concerns that Europe’s debt crisis may stall economic recovery in the region.
Oil futures in New York climbed as much as 1.5 percent, boosting the cost of making synthetic rubber from naphtha. The yen declined to 110.54 per euro as of 6:40 a.m. in London from 109.47 in New York yesterday.
The most-active rubber contract gained 5.5 percent this week, a second weekly gain, amid worries that there’s continued tight supply from major producing countries. The “supply situation hasn’t improved,” Kokubo said.
Tight Supply
The low supply from key producers together with robust demand in Asia will keep the market strong, the Association of Natural Rubber Producing Countries said in its May newsletter on May 25. Demand from China, India and Malaysia, which account for more than 45 percent of global consumption, should stay robust, the association said.
Cash prices in Thailand, the largest exporter, extended gains as rains in some southern provinces disrupted tapping, lowering supply, the Rubber Research Institute of Thailand said on its website today. Processers continued purchases on worries there’s a supply shortage, it said. Thai RSS-3 grade rubber for June delivery rose 1.6 percent to 125.40 baht ($3.85) a kilogram.
September-delivery rubber on the Shanghai Futures Exchange added 0.8 percent to settle at 22,585 yuan ($3,306) a ton.
--Editor: Jake Lloyd-Smith
To contact the reporters on this story: Aya Takada in Tokyo at atakada2@bloomberg.net; Supunnabul Suwannakij in Bangkok at ssuwannakij@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
source - http://www.businessweek.com
More Related News -
No comments:
Post a Comment