MUMBAI (Reuters): Natural rubber prices in India are likely to trade in a narrow range this week as a drop in world market levels and rising imports are seen offsetting lower arrivals to the local market, dealers and analysts said.
The benchmark January rubber on India’s National Multi-Commodity Exchange (NMCE) was 0.5 percent down at 20,295 rupees per 100 kg by 3:32 p.m.
“Arrivals are steady. They are not rising despite it being a peak tapping season,” said Anu V Pai, analyst at Geojit Comtrade. Rubber production in India peaks during October to January. “After tapping, some farmers are keeping latex in drums instead of making sheets. That’s why supplies are lower,” said a member of the Indian Rubber Dealers’ Federation (IRDF).
The price of the most-traded RSS-4 rubber (ribbed, smoked sheet) in Kochi market in Kerala eased six rupees to 20,106 rupees per 100 kg on Tuesday. The spot price in Bangkok, Thailand, was steady at 18,065 rupees.
Lower rubber consumption from tyre makers and higher imports will pressure domestic prices in the medium term, Pai said. India’s natural rubber imports edged up 4.6 percent in November to 15,069 tonnes, the state-run Rubber Board said on Dec. 9, and a steep price fall in overseas markets is likely to continue to make imports attractive for tyre makers.
The world’s fourth-biggest producer also imports natural rubber from Thailand, Indonesia, Malaysia and Vietnam.
The country’s production during November rose 4.3 percent on a year ago to 94,400 tonnes, while consumption was 82,000 tonnes compared with 78,010 tonnes a year ago.