The Colombo Rubber Auction experienced a drop in prices for all grades of rubber as the exporters slowed down their purchases in lieu of the Chinese Lunar New Year holidays.
Latex Crepe 1X settled at Rs. 600 while Latex Crepe 1 traded between Rs.590 to Rs.600.
China, the largest buyer of natural rubber in the world will be closed for their annual lunar festival during next 10 days. People with Chinese origin living in most South East Asian countries are expected to close businesses for this annual event.
Prices in Tokyo and Singapore firmed up as the crude oil prices rose, whilst heavy floods were reported in rubber growing areas of Malaysia hampering tapping operations.
"The market lacks direction because investors are both covering shorts and liquidating longs ahead of the Lunar New Year," said a Singapore-based trader.
Physical supply was better than last month and Tocom futures will likely trade mostly in a Y455-Y475/kg range this week, as per the brokers in Tokyo.
"The overall sentiment is bullish as investors are expecting strong physical demand from China after the Lunar New Year holidays," a Bangkok-based analyst said.
With the on set of wintering season, and the unexpected showers, rubber production is likely to decline in Sri Lanka in the coming weeks.
source - www.dailymirror.lk
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