Posted on 05 Mar 2012
NR Markets close lower after early gains are erased
Tocom opened at 342.7 yen/kilo (up 0.8 yen) on the benchmark contract.. It reached a high of 343.5 yen/kilo, before selling pressure reversed the gains and moved to 336.9 yen/kilo (down 5 yen). The benchmark closed at 338.9 yen/kilo. Volume was 6,150 lots. The evening session lost further ground with the benchmark closing a further 2.9 yen lower.
In shanghai the May contract opened 10 rmb lower at 29,340 rmb. It gained ground and traded at 29,450 rmb as the high. In the afternoon the Market started to ease, and levels fell to a low of 28,820 rmb (down 530 rmb), before settling for the day at 28,920 rmb.
SGX-Sicom in sync with the other two Markets opened lower, headed higher and then gave back the gains. Rss3 closed down 2.8 to 5.5 usc/kg and Tsr20 down 2.2 to 4.0 usc/kg.
You could drive a truck through the variation in stories today. There is great pessimism about the Chinese economy mirrored in low car sales, yet a headline story from a commodities research company who believes that NR prices are going to hit 450 usc/kg before May. WIDE range of opinions out there!
DJ Asian Rubber Declines On Weaker Outlook For China Growth
SINGAPORE (Dow Jones)--Asian rubber settled lower Monday after Chinese
Premier Wen Jiabao said in a speech at the National People's Congress that the
government aims for economic growth of 7.5% this year, after targeting 8.0% in
recent years.
Wen's comments weighed on natural rubber prices because China is the world's
largest consumer and importer of the commodity.
Benchmark August natural rubber on the Tokyo Commodity Exchange settled Y3.5
lower at Y338.4 a kilogram. A stronger yen also weighed on prices. Tocom may
rebound as major producing countries enter the heart of the low-output season
this month, but macroeconomic trends may still move Tocom this week, a
Tokyo-based broker said.
August Tocom rubber extended losses to close Y2.9 lower at Y335.5/kg in the
night session, which is considered part of the next trading day.
Natural rubber on the Shanghai Futures Exchange settled 1.0% lower.
Physical rubber prices were mostly lower, but the downside was limited due to
the low-output season in major producing countries.
Tire major Bridgestone Corp. (5108.TO) said Monday that it will spend Y50
billion ($615 million) to build a new factory in Thailand to produce off-road
radial tires for construction and mining vehicles.
The new plant will add to Bridgestone's existing production capacity for such
tires in Japan and the U.S., the company said, as it looks to meet increasing
global demand.
Production at the Thai plant will begin in the first half of 2015, with
output capacity reaching 85 tons per day by the first half of 2019.
...
-By Huileng Tan, Dow Jones Newswires, +65 6415 4083; huileng.tan@dowjones.com
(END) Dow Jones Newswires March 05, 2012 05:58 ET (10:58 GMT)
Copyright (c) 2012 Dow Jones & Company, Inc. 030512 10:58 -- GMT
China Car Sales Seen Having Worst Start Since 2005 on Economy
By Bloomberg News
March 5 (Bloomberg) -- Automobile sales in China, the
world's biggest car market, may be having their worst start in
seven years as a slowing economy and record gasoline prices keep
consumers away from dealerships.
Deliveries of passenger autos, including sport-utility
vehicles and light-goods vans, in the first two months of 2012
fell 3 percent from a year earlier, based on the median estimate
of five analysts surveyed by Bloomberg. That would be the
biggest drop since 2005, when they fell 8.9 percent, according
to the China Association of Automobile Manufacturers, which will
release industry data later this month.
Slumping deliveries in the world's second-largest economy
and Europe are undermining a revival in the U.S., where sales
are rising at their fastest pace in four years. In China, which
has fueled global growth in the past decade, foreign automakers
from General Motors Co. to Volkswagen AG are also facing tougher
regulations as the government rolls out policies favoring
domestic brands.
The days of China's vehicle sales going through the roof
are over,said Huang Wenlong, a Hong Kong-based analyst with
BOC International Holdings Ltd. I don't think the overall
economic situation is that optimistic.
China's monthly passenger-vehicle deliveries fell 24
percent to 1.16 million units in January, the most in more than
seven years, after an earlier-than-usual Lunar New Year holiday
season deprived dealers of a week's worth of sales. February
sales will increase 27 percent from a year earlier, according to
the median analyst estimate in the Bloomberg survey.
Lunar New Year
Economists and analysts typically combine statistics for
January and February to remove the distortion caused by the
holiday, which occurs either month depending on the lunar
calendar.
CAAM predicted in January that the country's passenger-car
sales may rise by 9.5 percent this year to 15.9 million units.
The best scenario is for annual car sales to remain flat,
even if the automakers try harder in the latter half,said
Zhang Xin, an analyst with Guotai Junan Securities Co. in
Beijing. The current official forecast for about 10 percent
growth doesn't look realistic.
China's gross domestic product expanded 8.9 percent in the
fourth quarter of 2011, slowing from a 9.1 percent gain in the
previous three months, as the government waged a campaign to
tame gains in consumer and housing prices. Growth will be about
8.5 percent this year, according to the Ministry of Industry and
Information Technology, the slowest pace since the global
financial crisis in 2008.
Fuel Prices
China increased the wholesale price for average 90-RON
gasoline to a record 9,417 yuan a metric ton, or $4.20 a gallon,
according to Bloomberg calculations based on government data.
American motorists paid $3.72 for a gallon of regular gasoline
in the week to Feb. 27, according to data from the Department of
Energy.
There are no incentives for consumers to buy, said Cui
Dongshu, Tianjin, north China-based deputy secretary general of
China's Passenger Car Association, an industry grouping. They
worry about their income prospects and there are more and more
people delaying their purchase.
Competition may intensify further among automakers if the
government follows through on its proposal to stop buying cars
from foreign brands.
Buy Local
All 412 models approved for purchase by state agencies this
year will be limited to Chinese brands, according to a proposal
disclosed by the industry ministry last week. The preliminary
list is open for public consultation until March 9, according to
the ministry.
Dongfeng Automobile Co. and Great Wall Motor Co. were among
Chinese automakers whose shares surged on Feb. 27 on speculation
the government, the nation's biggest buyer of vehicles, is
stepping up efforts to protect its domestic industry as they
struggle to compete against global producers such as GM and VW.
China stopped offering some incentives on investments from
foreign automakers this year to clamp down on overcapacity.
Global carmakers are counting on a rebound in China to help
drive earnings this year as auto demand in Europe is forecast to
decline for a fifth straight year as the sovereign debt crisis
unsettles consumers. Still, sales are accelerating in the U.S.,
where auto sales last month increased at their fastest pace
since February 2008.
Foreign brands accounted for nine of the top 10 car models
by sales in China last year, led by GM's Buick Excelle with
253,500 vehicles, followed by the 247,500 VW Lavida cars sold.
Last month, Ford Motor Co. opened a $490 million passenger-
vehicle factory in China on Feb. 24, increasing the automaker's
manufacturing capacity in the country by a third to more than
600,000 vehicles annually. The company's annual sales rose 7
percent to 519,390 units last year.
GM, the biggest overseas automaker in China, is poised to
receive approval to build a 7 billion-yuan factory in the
central city of Wuhan, according to a statement by the
provincial government last month. The plant will have annual
production capacity of 300,000 vehicles.
For Related News and Information:
Top transport news: TRNT <GO>
China auto news: TNI CHINA AUT <GO>
China auto sales: CNVSPSGR <Index> HCP M <GO>
--Tian Ying, with assistance from Chua Baizhen in Beijing.
Editors: Chua Kong Ho, Young-Sam Cho
DJ Natural Rubber Prices To Rise To $4.50/Kg By May -Macquarie
SINGAPORE (Dow Jones)--Natural rubber prices are likely to rise to $4.50 a
kilogram by May from about $4/kg now due to the low-production season in major
producing countries, as well as a revival in the U.S. and the Asian auto
industries, Macquarie Commodities Research said in a report released Monday.
Prices should ease to around $3.80/kg in the second half of 2012 as stocks
are replenished, although full-year average natural rubber prices are likely to
fall 14% to $4.14/kg from $4.81/kg, analysts Kona Haque and Chris Gadd wrote.
Stronger currencies in producer countries, rising crude-oil prices and
greater confidence in the global economy should also help support prices in the
first half, they said.
"But we think the outlook for the second half will very much depend on global
industrial trends, for which we have low confidence," they said.
Surplus Expected In 2012
Macquarie expects natural rubber stocks to expand beginning in the second
half of 2012 and prices to fall then and into 2013.
Global demand for natural rubber is expected to rise 3% in 2012, higher than
the 1.7% increase estimated for 2011. Despite the rise in demand, increased
production also means supply may outstrip demand this year.
In 2012, Macquarie expects a global natural rubber surplus of 37,000 tons,
after deficits in 2010 and 2011. The global surplus will likely expand to
125,000 tons next year, they said.
Quarterly Price Forecast In U.S. Cents/Kg *
2012 2013
Q1 395 410
Q2 450 390
Q3 420 370
Q4 390 375
Average 414 386
% Change -14% -7%
*Price forecast based on Sicom RSS3 futures
-By Huileng Tan, Dow Jones Newswires, +65 6415 4083; huileng.tan@dowjones.com
(END) Dow Jones Newswires March 05, 2012 06:40 ET (11:40 GMT)
Copyright (c) 2012 Dow Jones & Company, Inc. 030512 11:40 -- GMT