Informist, Monday, Mar 28, 2022

By Rahul Dhuri

MUMBAI – Prices of natural rubber rose to a three-month high in the key markets of Kerala due to rising demand from domestic stockists amid concerns about supply, market participants said. 

* Supply concerns are likely to persist as the lean production season has started in Kerala and is likely to continue till May. India's natural rubber production may fall, as heavy rains in Oct-Nov in Kerala, the country's biggest producer, affected the peak tapping season, said C.J. Augustine, the owner of Chettiparambil Traders based in Idukki.

* Sluggish production and import hurdles are driving up prices of natural rubber. Tapping of natural rubber has slowed down in March with temperatures rising in Kerala, industry experts said.

* On the global front, benchmark rubber contracts on the Tokyo Commodity Exchange ended in the red as investors booked profits after the recent surge in prices. Weakness in crude oil contracts on the New York Mercantile Exchange further weighed on rubber prices, analysts said.

* Crude oil futures on the NYMEX fell in Asian trade today as concern about disruption of supply eased after a partial resumption of exports from Kazakhstan's Caspian Pipeline Consortium terminal. Natural rubber prices take cues from crude oil as the latter is used to manufacture synthetic rubber. 

* However, the outlook for rubber remains firm on expectations of a strong demand outlook.

* The Association of Natural Rubber Producing Countries said that the demand for natural rubber from the healthcare sector is likely to rise. Auto sales growth in major economies will also increase the demand for rubber. The association expects global consumption to rise 1.2% to 14.2 mln tn in 2022. 

Following are highlights of today's trade:

--In the key markets of Kerala, the widely-traded RSS-4 variety was sold at 175-176 rupees per kg, up 1 rupee from the previous close. Prices have risen 4% on month and over 5% in the last three months.

--The most-active August contract of rubber on the Japanese bourse ended 0.8 yen down at 253.0 yen (155.84 rupees) per kg.

End 

Edited by Maheswaran Parameswaran

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