Market and product
Rubber remains in lower range
Rubber prices dropped significantly after the quake in Japan as the country is home to world’s leading rubber market, the TOCOM and also home to leading auto sector of the world. Prices dropped as low as 335 yen on March 15.
Rubber enjoyed relatively high prices across the world as the booming auto sector accounts for two third of the consumption. There for any major impact on the sector could reflect on rubber prices too.
The latest incident is the Japan quake which hit country’s auto sector, one of the world’s largest, and subsequently led to decline in rubber prices due to lack of demand.
Factories of automobile giants like Toyota, Honda, Suzuki and Nissan have yet to recover from the devastation caused by the quake and tsunami.
Rubber prices remained affected by the quake impact and also by China’s lack of demand as the country is in a process to fight its climbing inflation.
Prices in country’s major exchange in dropped again Friday as September-delivery natural rubber in was seen trading below the $5500 mark. It was at $5422 a ton at close of trade for the week.
Prices are not expected to climb soon as China’s major rubber harvesting season starts at the end of this month, analysts said.
Rubber prices in TOCOM remained in lower ranges as August contract was at 432.6 yen per kilogram at the close of trade Friday.
However, analysts said prices might comeback on strict market interventions. Three major rubber producing nations Thailand, Indonesia and Malaysia have agreed in principle to delay exports if prices tumbled.
Another major rubber consumer India is expected increase rubber purchase next fiscal as country’s rubber demand is projected to rise by 6 percent.
Global demand for natural and synthetic rubber is expected to increase to 26.1 million tons in 2011.
