The domestic rubber market has seen a sudden rise in price due to heavy offtake by China, world’s largest consumer of natural rubber (NR). The price reached Rs 101 a kg, the highest in a month.
The gap between domestic and international prices is narrowing day by day. Almost a month ago, the Indian price tag was higher by around Rs 17 a kg which paved the way for more imports.
According to leading Kochi-based dealers, the market would be dearer for a short while as the production season was on the anvil. The season would commence by the middle of September and around 45 per cent of the total annual production takes place during October-December. Unless there is a sustained growth in demand in countries such as China, US, India, Japan and Korea, the bull phase might fizzle out by next month.
Global shortfall puts rubber on a firm wicket
Rubber Headed for First Loss in Five Weeks
Rubber dropped as much as 2.5 percent, headed for its first decline in five weeks, on speculation a U.S. jobs report may revive concern that worsening unemployment will curb consumer spending and cap demand for the commodity.
Futures in Tokyo declined for a second day in three, retreating further from a nine-month high reached Aug. 4.
Italian tyre maker Pirelli & C (PECI.MI) said on Thursday its sales in China rose 40 percent in the first half from a year earlier, but weak global demand has put a planned $100 million investment in the country on hold.Despite bullish sales in China, demand in the United States and Europe had dropped sharply, a clearer picture would appear by the end of this year.
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