Posted on 18 Jan 2012
BBC Report On Thai Government Rubber Stockpile
Overnight
the BBC interviewed Mike Coleman, one of our primary shareholders,
about the possibility of Thai government intervention in the natural
rubber market to boost prices. Feel free to view the interview here.
NR Markets Continue To Move Higher
Despite the closeness of Chinese New Year, the natural rubber market remains very active. Speculation abounds about the willingness of the Thai government to put half a billion US dollars in to the development of a NR stockpile. In China, despite the presence of relatively high stocks of rubber in the port areas, news sources report that the Chinese are buying.
The momentum from yesterday's run up, carried market another notch higher today. Tocom's benchmark surged to an intra day high of 300.2 Yen/kilo (up 8.8 yen) before surrendering some of its gains, to settle the day at 298.5 Yen/kilo - adding 7.5 yen from yesterday's settlement. Further profit taking following the recent rally saw prices slipping 2.5 Yen to 296.0 Yen/kilo during the evening kerb session. Turnover was 9,802 lots
Shanghai actually opened marginally lower by 20 rmb at 26,230 rmb. It gained ground to reach a high of 26,730 rmb ( up 480 rmb) on the May contract, before ending off its high for the day at 26,555 rmb - just 305 rmb higher from yesterday's closing level.
SGX-Sicom followed the pack but closed off the highs with Rss3 up 4.7 to 11.5 usc/kg and Tsr20 up 2.7 to 5.1 usc/kg.
DJ Asian Rubber Settles Higher Due To Thai Price-Intervention Plan
SINGAPORE (Dow Jones)--Asian rubber settled higher Wednesday due to
expectations that the Thai government will soon intervene in the market to
boost prices by as much as 20% from current levels.
The benchmark June natural rubber futures contract on the Tokyo Commodity
Exchange, or Tocom, settled Y7.5 higher at Y298.5/kg Wednesday after hitting a
11-week high and testing the key resistance level of Y300/kg earlier in the
day. Higher crude-oil prices also helped support Tocom rubber.
Kaname Gokon, deputy general manager of Tokyo-based Okato Shoji, said
investors were covering short positions and prices may test resistance at
Y305/kg this week.
The benchmark Tocom contract has risen more than 7% this week.
Thai Deputy Prime Minister Kittiratt Na-Ranong told reporters in Bangkok
Tuesday that the government plans to use up to THB17 billion to support prices
by procuring rubber directly from growers. The government hopes to raise prices
to THB120 a kilogram or higher, from around THB100-THB103/kg now.
The cabinet will consider the plan on Jan. 24.
June Tocom rubber closed Y2.5 lower at Y296/kg in the night session, which is
considered part of the next trading day.
Natural rubber on the Shanghai Futures Exchange settled 1.2% higher. Traders
said prices may consolidate in the next two sessions as caution ahead of the
Lunar New Year, which starts Jan. 22, offsets any upbeat sentiment over
Thailand's intervention plan.
Physical rubber prices also rose. Some Thai exporters held back on offers as
prices of raw materials continue to climb.
Despite general bullishness, some market participants were skeptical about
the sustainability of Thailand's move.
"I wonder if these moves by the Thai government will really drive up prices
even when sentiment takes a real hit in the broader markets," a Singapore-based
dealer said.
...
-By Huileng Tan, Dow Jones Newswires; +65 6415 4083; huileng.tan@dowjones.com
-- Yue Li in Shanghai contributed to this article.
(END) Dow Jones Newswires January 18, 2012 05:53 ET (10:53 GMT)
Copyright (c) 2012 Dow Jones & Company, Inc. 011812 10:53 -- GMT
DJ China Actively Buying Rubber Overseas Despite High Qingdao Stocks - Traders
SINGAPORE (Dow Jones)--High inventories at the main rubber port of Qingdao in
China are raising concerns that demand in the world's biggest market may be
slowing, but traders said Wednesday that Chinese buyers have been active in the
international market recently.
Traders familiar with the situation said inventories totaled 224,600 metric
tons on Jan. 15, compared with 166,000 tons as of Oct. 31. The stocks include
compound rubber, which is high in natural rubber content. Qingdao stocks data
aren't publicly released.
"Stocks may be high but China is definitely still buying on the international
scene, though not aggressively, due to the Lunar New Year," a Singapore-based
dealer said, adding that the market has priced in the stock levels.
A major exporter in Bangkok said much of the stockpile was bought at higher
than current prices, and sellers are unwilling to sell large amounts below
cost. Qingdao stocks are usually sold at a discount to international
free-on-board offer prices.
Also, some stocks are being held as collateral by banks and may be subject to
their conditions before they can be released, the Singapore-based dealer said.
"Compared to the amount of rubber than China uses, these stock levels are
actually nothing," the Bangkok-based trader said.
China is the world's largest consumer and importer, accounting for one-third
of global demand.
Preliminary figures from the country's General Administration of Customs
indicate 2011 imports rose 13% to 2.1 million metric tons, compared with a 8.8%
rise in 2010.
China's 2011 tire output rose 8.5% to 832.1 million units, the National
Bureau of Statistics said Tuesday.
Traders said buying is expected to pick up in February after the Lunar New
Year break, adding that the Qingdao stocks may start to decline following an
expected rise in prices due to the low-output season in major producing
nations, and if the Thai cabinet approves a price intervention plan next week.
Benchmark futures on the Tokyo Commodity Exchange settled at Y298.5 a
kilogram Wednesday, 44% lower than a record high hit in February 2011.
-By Huileng Tan, Dow Jones Newswires, +65 6415 4083; huileng.tan@dowjones.com
(END) Dow Jones Newswires January 18, 2012 06:32 ET (11:32 GMT)
Copyright (c) 2012 Dow Jones & Company, Inc. 011812 11:32 -- GMT
New RCMA Commodities Asia Website
Dear Customers,
We're pleased to announce the launch of our website:
www.rcma-commodities.com
If you click on the "polymers" link under products, you can get back to the www.rcma-rubber.com site with all its functionality. Please contact whl@rcma-americas.com with any questions or concerns.