Rubber Futures Gain as Crude Oil's Rally Boosts Appeal, China May Purchase

The most active March contract on Shanghai rubber futures and the benchmark March contract on Tokyo rubber futures fell consecutively on 20 October and 21 October as investors were concerned about the rises in China’s benchmark one-year lending rate to 5.56% from 5.31% and the deposit rate to 2.50% from 2.25% on Tuesday that would tame commodity markets, including rubber futures. At the same time, that gave an opportunity for some rubber investors to unwind their long positions and took profits.

DESCRIPTION	20 OCT	21 OCT	CHANGE		% CHANGE	UNIT
IRCo's DCP	397.01	396.87	-0.14		-0.04%	US cents/kg
TOCOM/RSS3 *
- Oct. 10	324.00	325.00	1.00		0.31%	Yen/kg
- Mar. 11	335.20	334.50	-0.70		-0.21%	Yen/kg
SHFE/RSS3 **	31,530	31,455	-75		-0.24%	Yuan/ton
SICOM/RSS3
- Nov. 10	402.40	403.90	1.50		0.37%	US cents/kg
- Oct. 11	407.00	407.00	0.00		0.00%	US cents/kg
SICOM/STR20
- Nov. 10	397.00	394.80	-2.20		-0.55%	US cents/kg
- Oct. 11	395.50	395.00	-0.50		-0.13%	US cents/kg
AFET/RSS3
- Nov. 10	118.45	118.45	0.00		0.00%	THB/kg
- May 11	122.10	120.50	-1.60		-1.31%	THB/kg
RRIT ***
- RSS3	120.30	120.30	0.00		0.00%	THB/kg
- STR20	118.75	118.75	0.00		0.00%	THB/kg
SIR20 ****	394.00	396.00	2.00		0.51%	US cents/kg
SMR20 ****	396.00	400.00	4.00		1.01%	US cents/kg
Source: IRCo Note: * Day session         ** The highest daily trading volume was Mar. 2011        *** RRIT means Rubber Research Institute of Thailand       **** Offer, f.o.b., Asian physical rubber prices for Nov./Dec. delivery, Dow Jones

However, the spot month contract on Tokyo rubber futures and physical prices still stayed firm during the said two days because the rubber supply tightness still lent support for the rubber price to stay on the high side. In addition, typhoon Megi has hit the northern Philippines and is expected to reach China’s southern regions, including Hainan province that may damage rubber plantations on that island this weekend.

For other recent rubber news, China, the top rubber consumer, imported 190,000 tons of rubber in September, up 19% from an earlier month as the domestic passenger car sales to dealerships quickened from August on additional incentives for buyers, according to Bloomberg on Wednesday.

The Chinese passenger car sales for the January - September period rose 36.7% to 9.9 million units, according to the China Association of Automobile Manufacturers (CAAM). CAAM added that the Chinese overall vehicle sales rose to 1.6 million units in September, from 1.3 million units a year earlier.

In India, the rubber price also rose during the same period due to persistent supply tightness caused by lingering heavy rainfall in southern rubber planted areas and robust demand from tire makers.

(Irco.biz)