NMCE Rubber Intraday Outlook

Commodities Technical Analysis | NMCE Rubber Intraday Outlook | 24 August 2009 | www.commodityonline.com

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Fears of shortfall in production once again push up rubber prices in NMCE on Saturday.

Natural rubber production in India dropped 10.9 percent during the first seven months of the current year. Production was 8.32 lakh tonnes of rubber during the 12 months to July, which was a 5.6 per cent fall over the corresponding period of last year.

The imports of rubber stood at 51,000 tonnes on July 9, and that compared with 21,000 tonnes imported during the same period of last year. Exports, on the other hand, stood at just 1,000 tonnes compared to 15,000 tonnes. Lower exports and higher imports have pushed up the stock level to 1.9 lakh tonne by the end of June as compared to 1.4 lakh tonne during the same period last year.

Meanwhile, global rubber production registered a fall of 4.6 per cent till July. Malaysia registered 17 per cent fall. Production fell by 12.4 per cent in Thailand during the six month period. Indonesia’s natural rubber output fell by six per cent during the first half of the year. Vietnam witnessed a 7.3 per cent fall in January-July period. The Vietnam Rubber Association expects a five per cent production shortfall to persist until October.

China and Sri Lanka are the only two countries to show a growth in production and have helped to cushion the global shortfall. China has recorded a 54 per cent growth in production.

NMCE rubber moved in the range of Rs10375-10283 last traded at Rs.10368 (10275) Open interest decreased by 14 to 1493. Rubber stocks at NMCE accredited warehouses increased by 17 to 107 Mt.

INTRADAY OUTLOOK

NMCE Rubber September futures support lies at 103.05 and 102.50. Resistance is at 104.00 and 104.35